FSCA Pauses the Financial License of Banxso

On October 6, South Africa's Financial Services Conduct Authority (FSCA) has temporarily withdrawn Banxso's (No. FSP37699) license.

On April 19, the regulator announced the investigation into Banxso, stating that the financial services provider may have caused losses to customers. Based on the results of the available investigation, the FSCA made the decision to temporarily withdraw its license.

The regulator found that Banxso's activities may have involved advertisements using deepfake technology.

In addition to this, Banxso's agents employed aggressive sales tactics, pressurizing clients and making unrealistic promises of returns. However, the broker failed to conduct the required risk analysis for clients of specific financial products, causing actual losses to them.

In October, the FSCA reported the case to South Africa's Financial Intelligence Center (FIC), which froze seven of Banxso's bank accounts. In response, Banxso appealed to the court to have the accounts unfrozen, but the court rejected the appeal.

The FSCA said the investigation into the company is not yet complete. During the license suspension, Banxso has the opportunity to provide reasons for the regulator to reverse the decision. The regulator will consider the results of the investigation and the explanations submitted by Banxso when the final results are available.