Irish based spread betting looks in trouble after four firms were accused of being in breach of EU law. Nasdaq.com reports that the companies, who have not been named, are in breach of EU law as identified by the Irish Central Bank earlier today. It’s thought that they provided insufficient and inappropriate information; published misleading marketing material; and failed to tell clients of potential losses in using financial spread-betting and CFD products.
A spokesperson commented, “The central bank is considering enforcement action that could lead to sanctions being triggered.
“None of the firms were fully compliant with EU law–the Markets in Financial Instruments Directive.”
The bank’s head of consumer protection, Sharon Donnery, also added, “Consumers need to be made fully aware of the complexity and very high risks of CFD and financial spread betting before making investment decisions.
“Some of these investment firms are failing to fully inform and provide adequate warnings to consumers of the risks that CFD and financial spread betting carries before they begin trading.”
The bank’s surveillance was stepped up after reckless lending during the Irish economy’s boom years led to the current parlous state of the country’s economy.
In other news, Swedish firm Betsson has finally completed its acquisition of Betsafe in order to firm up their position in Scandinavia. The initial price of the deal is €32.5m and can now go through thanks to all regulatory approvals being received. Future payments will take it up to €60m and are dependent on “the development of the acquisition and the integration thereof during 2011.”