eToro Philippines illegal promotion Sparks Regulatory Firestorm

eToro Philippines illegal promotion ignites a regulatory firestorm, prompting swift action from authorities. According to the local regulator, individuals such as salesmen, brokers, dealers, or agents promoting eToro in the Philippines face the threat of a monetary fine amounting to 5 million pesos (approximately US$88,500) or imprisonment for up to 21 years, or both, as the platform is not authorize to sell or offer securities to the public in the Philippines.

Unraveling eToro’s Philippines Illegal Promotion

The Securities and Exchange Commission of The Philippines issued the advisory against the broker on March 14 and made it publicly available.
The regulatory body of the Southeast Asian nation mandates that platforms offering securities and investment products ensure that the securities they offer locally register and issue by a locally registered corporation or dealer. Additionally, the issuer must possess a secondary license to sell or offer securities to the public. However, eToro illegal promotion in the Philippines triggers regulatory scrutiny and potential legal repercussions.

The local regulator emphasizes in the advisory, “Based on the Commission’s database, the operator of the platform eToro is not registering as a corporation in the Philippines and operates without the necessary license and/or authority to sell or offer any form of securities.”

“The public is hereby advises to exercise caution before investing in these kinds of unregistered online investment platforms and their representatives.”

eToro’s Rogue Marketing

eToro, with its headquarters based in Israel, maintains regulatory and registration compliance across various jurisdictions including the United Kingdom, Cyprus, the Netherlands, France, Spain, Italy, Malta, the UAE, Australia, Seychelles, the United States, and Gibraltar. The platform offers a diverse range of assets, spanning from equities to cryptocurrencies and contract for differences, among other popular asset classes.
The Filipino regulator highlighted that the broker lacks a license in the country, yet it actively marketed its offerings to Filipinos and permitted them to open accounts.

“eToro’s operations allow Filipinos to create user accounts on their platform for the purpose of investing and trading unregistered investment products,” the regulator highlighted.

However, eToro denied engaging in “actively promoting” its services in the Philippines.

“Financial regulatory authorities regulates eToro in multiple jurisdictions around the world and we take our legal and regulatory obligations very seriously. eToro has no local presence in the Philippines and we do not actively promote or market our services in the Philippines,” a eToro spokesperson reported Finance Magnates.

In the meantime, eToro is contemplating pursuing an initial public offering in the United States following an unsuccessful attempt at a reverse merger with a bank-check company. While specifics regarding the potential public listing remain undisclosed, CEO Yoni Assia disclosed the company’s aim for a valuation exceeding $3.5 billion.

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