South African Regulator Warns Against Using Mirror Trading International
Mirror Trading International is getting flak from regulators worldwide.
A month after the Texas State Securities Board took action against Mirror Trading International (MTI), South Africaâ€™s Financial Services Conduct Authority (FSCA) is also investigating the companyâ€™s trading activities.
According to the information MTI shared with FSCA, the company conducts high-frequency derivatives trades using bots on behalf of its clients.
The financial watchdog said in a statement that the current business model of MTI requires it to own a financial service provider license but it does not seem to have one.
The FSCAâ€™s biggest concern was that MTI was promising its clients returns of as much as 10% per month. This, they stressed, was quite far-fetched and unrealistic.
While the company claims to have more than 2.9 billion South African Rand (~$168 million) in clientsâ€™ funds in trading accounts, the FSCA said it was concerned whether the funds really existed.
The FSCA warned people against using MTIâ€™s services, claiming it did not own the mandatory license to operate and has advised its existing clients to request immediate refunds.
To add more substance to their doubts against MTI, the FSCA pointed to a public statement by MTIâ€™s platform broker FX Choice, which denied the legitimacy of the services and trading volumes claimed by MTI. The regulator said it was currently in the process of obtaining confirmation regarding these claims.
The regulator said that it was reviewing information and will involve the South African Police Service once they are able to confirm the discrepancies.
In July, MTI had claimed that it was in discussion with the FSCA and was working on regulatory compliance. It also said it would engage with â€œU.S. Texas Securities Commissionâ€œ regarding the cease and desist order from the Texas State Securities Board.
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