BUX Faces €1.6 Million Fine from Dutch Regulators for Referral Incentive Violations
The Netherlands Authority for the Financial Markets (AFM) has recently levied a substantial fine of €1.6 million against the neo-broker BUX. This penalty stems from violations concerning the ban on inducements, highlighting the regulatory challenges faced by fintech companies in the evolving financial landscape.
Details of the AFM Fine Against BUX
The fine imposed on BUX relates to the company’s previous practices of offering incentives to existing customers, comparison websites, and financial influencers, which the AFM deemed as breaches of regulatory inducement prohibitions. These referral payments, which BUX ceased in April 2023, were criticized for potentially compromising the integrity of customer interests.
BUX’s Response to the Inducements Ban
Yorick Naeff, the CEO of BUX, addressed the situation by emphasizing the company’s commitment to transparency and the prioritization of customer interests. He stated, “At BUX, transparency and the interests of our customers always come first. While we respect the AFM’s position, we want to emphasize that the referral fees we have paid in the past came out of our own pocket and have never been at the expense of our customers.”
Innovations and Acquisitions in the BUX Ecosystem
Despite the regulatory hurdles, BUX is making strides in innovation. The company has become the first pan-European partner to adopt PrimaryBid’s capital markets platform. This partnership will allow retail investors in Belgium and the Netherlands to engage in initial public offerings (IPOs) and regulated fundraises, activities that were previously restricted to institutional investors.
Recent Acquisitions and Strategic Moves
In a significant development, BUX Financial Services, a subsidiary of BUX, has been acquired by Asseta Holding, the parent company of UAE-based APM Capital. This acquisition follows BUX’s acquisition by ABN AMRO in December 2023 and includes BUX’s operations in the UK, which were regulated by the Financial Conduct Authority (FCA) under the BUX Markets brand, known for offering contracts for differences (CFDs) and financial spread betting services.
Strategic Divestments and Future Plans
The divestment of BUX Markets aligns with a broader strategic vision, which was anticipated after BUX announced its plans to sell this business unit last year. According to CEO Naeff, this move represents the divestment of the remaining regulated subsidiaries, with BUX retaining only its Cyprus-based entity.
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