Forex broker eToro has become a new target of the Philippine Securities and Exchange Commission (SEC) following the attack on the Binance exchange.
The SEC said that eToro is not authorized to make securities offers to residents of the Philippines, Cointelegraph reported.
In a ruling published on April 4, the regulator said that online investment trading platform eToro does not have a license to operate, "is not registered as a corporation in the Philippines, and is operating without the required license."
According to the document, "eToro has been running advertising campaigns on various websites and social media to entice Filipinos to engage in trading activities using its platform. eToro's activities enable Filipino citizens to register user accounts for the purpose of investing and trading in unregistered investment products."
The company was accused of not being registered and not having the necessary licenses or authority required by the Securities Regulation Code to sell securities, act as a broker-dealer, or operate an exchange for the trading of securities in the country.
The Securities Regulation Code requires that:
- the securities offered must be registered with the Philippine Stock Exchange by filing an application for registration;
- the securities must be issued by a corporation or licensed dealer registered in the Philippines;
- the issuer must have a secondary license to sell or offer the securities.
Recall that in November 2023, cryptocurrency exchange Binance received a similar notice from the SEC because it "is not authorized to sell or offer securities in the country."
In March 2024, the Philippine government, through the National Telecommunications Commission of the Philippines (NTC), began blocking unlicensed cryptocurrency exchange websites. This affected all companies that were not directly licensed in the Philippines.
Although eToro is a multinational company, the SEC Philippines advised the public to "think before investing in unregistered online investment platforms."
The regulator also warned that those acting as sellers, promoters, or agents of eToro in the Philippines could face a fine of up to $88,300 (5 million Philippine pesos) or 21 years in prison for violating securities laws.
It's worth noting that the Philippines is currently listed as a supported country on eToro's website.
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