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SPF, IMDA and MAS block unregulated overseas online trading platform

MAS, Monetary Authority of Singapore, central bankThe Singapore Police Force (Police), the Infocomm Media Development Authority (IMDA) and the Monetary Authority of Singapore (MAS), have taken action to block the website of an unregulated trading platform – Arotrade. The Police received complaints from at least 40 Singapore residents about the online platform, allegedly registered in Belize purporting to offer trading in Contracts for Difference (CFDs) for different asset classes such as stocks, foreign exchange, commodities, cryptocurrency and indices.

The individuals had transferred over S$330,000 in total to trade through the platform but either subsequently experienced unauthorised trades in their accounts or encountered difficulties withdrawing their monies. Arotrade has been linked to fraudulent marketing tactics, including the use of fake news articles falsely claiming that prominent individuals, including Singapore’s Political Office Holders, have endorsed investments in cryptocurrency, which misled and channelled people to the website.

Based on information gathered, the Police and MAS have assessed that the services on Arotrade’s website offered to residents are in breach of the Securities and Futures Act (SFA). Consequently, IMDA has determined that the information on the website constitutes prohibited content under the Internet Code of Practice (ICOP). IMDA has directed Internet Access Service Providers (IASPs) to block access to Arotrade’s website from Singapore residents, and all IASPs have effected the restriction.

The Police and MAS advise members of the public to exercise caution when dealing with unregulated online trading platforms. Most unregulated online trading platforms are located outside Singapore and pose a greater risk of fraud since the credibility of their operations cannot be easily verified. Members of the public will face challenges in pursuing claims against operators based overseas. Online trading platforms may also require payment for trades to be made using credit or debit cards, which gives rise to further risk of unauthorised card transactions.

Members of the public can first verify if an online trading platform has a valid capital markets services licence issued by MAS by checking MAS’ Financial Institutions Directory. They can also check MAS’ Investor Alert List, which contains unregulated persons and entities who, based on the information received by MAS, may have been wrongly perceived as being licensed or authorised by the central bank.

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