The targeting of Czechia by Profit Level: a summary of opaque activities(1) BCM Begin Capital Markets CY Ltd (274/15)
(1.1) Trading platforms operated by BCM
The company operates various online trading brands and platforms in the European market, including profitlevel.com, which boasts of having received the first prize in the category of the best Forex broker at the Forex Expo in Dubai in 2021. Looking for Profit Level’s approvals from the Cypriot regulator CySEC, we note that BCM Begin Capital Markets CY Ltd operates two other trading platforms: capitalpanda.com and begincapitalmarkets.com.
The activity of these three platforms is concentrated in a part of the Balkans and Western Europe: their respective websites offer Czech, Hungarian, Slovak, Greek, Spanish, Croatian and English as language choices, which is a good indicator of the geographical market targeted by BCM Begin Capital Markets CY Ltd. The only exception that can be noticed in this structure is that the platform capitalpanda.com offers its services in Italy, which does not seem to be the case for the other platforms of BCM CY Ltd. Moreover, the Italian regulator CONSOB does not specify which platform operated by BCM CY Ltd provides its services in its territory.
Moreover, these targeted countries are all members of the European Union and the European Economic Area. Therefore, European investors deciding to trade via one of the platforms operated by BCM Begin Capital Markets CY Ltd are protected by MiFID II (Markets in Financial Instruments Directive) – the regulatory framework approved by the European Parliament to unify, stabilize, and protect consumers of financial products in these territories.
(1.2) Activities of the tied agents
As CySEC indicates, BCM Begin Capital Markets CY Ltd has what are called “tied agents”: these are third parties providing their services, such as order execution or investment advice, on behalf of the main entity employing them. BCM CY Ltd has 6 such agents:
– Solum VLC Marketing Company S.L., which acts in Spain on behalf of begincapitalmarkets.com
– Golden Line Management Kft. which acts in Hungary on behalf of begincapitalmarkets.com
– OX Czechia s.r.o., acting in the Czech Republic on behalf of begincapitalmarkets.com
– Trade Online d.o.o., acting in Croatia on behalf of begincapitalmarkets.com
– Aegan Equity Single Member P.C., acting in Greece on behalf of begincapitalmarkets.com
– GTA GT Single Member P.C., acting in Greece on behalf of profitlevel.com
However, it seems that this information is difficult to access without performing a specific search. There does not seem to be any specific mention of these tied agents on the profitlevel.com and capitalpanda.com platforms, but begincapitalmarkets.com does mention them on its platform, however citing Solum VLC Marketing Company S.L. and OX Czechia s.r.o.. We can therefore wonder about the interest of BCM CY Ltd to solicit tied agents on its behalf without being transparent in this respect for its consumers.
Also, it seems important to us to note that BCM Begin Capital Markets CY Ltd operated part of its activities in Slovenia, specifically with its tied agent Profit Level d.o.o. This practice was revoked on 11 November 2022. This coincides with the CySEC sanctions (see 1.3): one may therefore wonder about the reasons for such decisions. Is there a link between the termination of the company’s services in Slovenia and the CySEC decision? Is there evidence that the tied agents of BCM CY Ltd are acting outside their prerogative?
(1.3) Revoked and disguised activities
BCM Begin Capital Markets CY Ltd has recently changed its business identity. Indeed, the company was called Ox Capital Markets Ltd until recently, and operated the trading platform oxmarkets.com under the Cypriot regulatory framework. According to the website wikifx, which lists trading players in the form of a time capsule, there are similarities between oxmarkets.com and one of BCM’s current platforms: begincapitalmarkets.com.
In concrete terms, begincapitalmarkets.com has recycled the visual identity and the graphic charter of the obsolete platform oxmarkets.com. No optical changes were made from one site to the other, even going so far as to use the generic images of oxmarkets.com, even though three years had passed between the screenshot of the latter site and the implementation of begincapitalmarkets.com.
What are the reasons for creating a carbon copy of a dismissed site? Is this evidence of a scamming scheme on the part of BCM CY Ltd?
Another confusing point about BCM CY Ltd’s activities is that its Summary Execution Quality Statement (their activity and logistics processing report) mentions that the company is not responsible for the execution of orders placed on its platform as it does not provide liquidity. This means that they use a third party to handle their investors’ trades.
Particular mention is made of London Prime Ltd, which presents itself as a Liquidity Hub Software, based in Belize. This seems rather surprising given that BCM CY Ltd and the domains it operates are licensed in Europe, regulated by CySEC and under MiFID II. Why use an offshore liquidity provider, free from any regulatory framework, for a controlled company?
For your information, offshore companies can circumvent restrictions put in place by MiFID II and CySEC, such as a duty of transparency regarding the financial products offered. Obtaining a license to operate in a country that regulates its financial activities allows both to give credibility to the broker’s activity and to protect the interests of the individual investor. If the funds of the users of the trading platforms of BCM CY Ltd are transferred to a third party acting outside of any regulatory framework, there is no guarantee to identify these funds, their route and to recover them.
Last point: CySEC reached a financial agreement in November 2022 with BCM CY Ltd, for an amount of 100.000€. This is a result of ‘potential violations’ committed by the company and the three trading platforms it operates (profitlevel.com, capitalpanda.com and begincapitalmarkets.com). Specifically, the agreement concerns the possible non-compliance of the company in relation to articles 5.1, 25.1 and 25.3 of the Law on Investment Services and Activities and Regulated Markets of 2017. This Law was published in the Official Gazette of the Republic of Cyprus, in accordance with the European Parliament Directive 2014/65/EU. It is in line with MiFID II.
In other words, this means that BCM CY Ltd might have circumvented certain directives regarding its authorizations in Cyprus, and potentially failed to comply with certain general principles of disclosure and transparency regarding their activity.
(2) Profitlevel.com user reviews:
(2.1) Review of specific TrustPilot reviews
It is mentioned on the TrustPilot website that many reviews have been removed due to their forgery. It is not unusual for some brokers with dubious practices to generate advantageous advertising for their services, thus misleading consumers about the security guaranteed by the platform. In other words, there is a good chance that Profit Level representatives are fabricating false positive reviews in order to hide the reality of trading on this platform (remember that it is mentioned on their website that 88.85% of traders using the platforms operated by BCM Begin Capital Markets CY Ltd lose their invested capital).
Reasonably, even statistically, it seems incongruous to us that out of 26 reviews, profitlevel.com obtains a score of 4.1/5 when their own accounts confirm that 88.85% of their investors are losers. Either there is a mismatch between these data, or the fact of losing one’s investment capital has no influence on the usability of the platform.
If we look at the original comments about Profit Level, we can see that users come from Europe, mostly from the Czech Republic. In fact, out of 26 reviews recorded since 2021, 20 of them (whether genuine or fabricated) are from Czech consumers.
(2.2) Czech consumers targeted?
If the elements mentioned above are not sufficient to determine that BCM CY Ltd is specifically targeting the Czech market, here is another element confirming the targeting in the Czech Republic: their marketing material and other online advertisements, specifically in Czech, promote the platform as the “best in Europe”, without however establishing a basis to justify this claim.
In addition, Profit Level’s social networks list a Czech phone number as an official contact, and the redirect link to their trading platform specifically states that one will be redirected to the Czech version of their site:
Our network Financial Fraud Lawyers defends the interests of individual traders in Europe. Mgr. Jana Mikova is part of our team specializing in disputes between investors from the Czech Republic and trading platforms such as profitlevel.com. If you believe you are a victim of non-compliant practices on the part of this or any other broker, please do not hesitate to contact us.
Disclaimer:
The Financial Fraud Lawyers network aims to inform private investors (traders) of potential malpractices by Forex and CFD brokers. Our mission is to assist and protect traders when they encounter brokerage practices that go against their interests.
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