KUALA LUMPUR (May 20): The Securities Commission Malaysia (SC) said today multi-asset investment platform eToro is not licensed or registered by the SC to carry out any regulated activities in Malaysia, including operating a recognised market through an online platform.
"Any person carrying out regulated activities in Malaysia without a licence or registration from/by the SC may, if convicted, be liable to a fine not exceeding RM10 million or imprisonment not exceeding 10 years or both.
"Malaysian investors who deal with unlicensed persons, especially entities operating offshore, are not protected under the Malaysian securities laws. They are also exposed to various risks, including fraud and money laundering, and may not have access to legal recourse in the event of a dispute, ” an SC spokesperson said in an emailed statement to theedgemarkets.com.
As at the time of writing, theedgemarkets.com did not find any record of eToro on the SC's investor alert list, which provides information on persons or entities that do not comply with Malaysian securities laws.
News reports quoted eToro as saying that investors in Asia are “regulated under eToro’s Australian Securities and Investments Commission (ASIC) licence” and “therefore investors can trade through the ASIC license”.
eToro said on its website that its operating unit eToro AUS Capital Pty Ltd is authorised by the ASIC to provide financial services under Australian Financial Services Licence 491139.
Elsewhere, eToro (Europe) Ltd is authorised and regulated by the Cyprus Securities and Exchange Commission (CySEC) under the license # 109/10, while eToro (UK) Ltd is authorised and regulated by the Financial Conduct Authority (FCA) under the license FRN 583263, according to the website.
eToro claims that its platform offers tools for investments in assets including cryptocurrencies, stocks, commodities and exchange-traded funds.
On Monday, eToro announced that it will extend its commission-free stocks offering to clients in Asia-Pacific, effective immediately.
The zero-commission offering for Asia-Pacific clients applies to all stocks on its platform that are traded on the Nasdaq and New York Stock Exchange, eToro said in a statement.
"The company believes this makes eToro the first platform to offer commission-free stocks and fractional shares globally (available to users in over 100 countries).
"Over the past 13 years, eToro has grown considerably and now has over 13 million registered users in more than 100 countries. The platform enables people to invest in the assets they want, from stocks and commodities to crypto-assets. Users can also choose how they invest: They can execute a trade themselves, copy another user or invest in a portfolio,” eToro said.