Issued on February 12th, 2021
This advisory is issued by the Financial Services Authority (“FSA”) pursuant to section 4(1)(m) of the Financial Services Authority Act, 2013 (“FSA Act”) and is addressed to the general public and to potential investors in respect to the scope of the FSA’s regulatory function.
Reference is made to the FSA’s alert posted on February 4th, 2021 on the International Business Company ("IBC"), Mek Global Limited with IBC number 207897 and a recent interview by the FSA that was aired on February 11, 2021. At this point in time, the FSA has deemed it important to convey additional information in relation to the IBC in view of it being aware of certain information being circulated within the public domain that may not necessarily represent the true facts of the case and the position of the FSA on the matter.
With regards to the information available on the public domain concerning an alleged “hack” on the cryptocurrency exchange platform of KuCoin, that apparently took place over the course of 2019 and 2020 the FSA hereby informs the public that whilst it is concerned at the allegations being made involving a Seychelles IBC, it recognizes that the alleged illicit act may have a negative impact on the platform as well as to the users of the platform concerned.
The FSA would also like to inform the public that the exchange platform appears to be affiliated with the IBC, Mek Global Limited. The FSA wishes to inform the public that enquiries into the affairs of the IBC was initiated in 2019 following receipt of certain information from both domestic and international supervisory counterpart authorities. It is to be noted that the IBC was eventually struck off the Register of IBCs in November of 2020 by the FSA, but is yet to be dissolved.
As part of its procedures in matters such as these the FSA also issued an alert on its website on February 4th, 2021 to advise the public that whilst the IBC Mek Global Limited was incorporated in Seychelles under the International Business Companies Act, 2016, the company is not regulated or licenced by the FSA to conduct businesses of any type in Seychelles including those that were being offered by the online platform which also made reference to the IBC in question on the platform.
The public is thereby advised that the FSA’s enforcement action (i.e. the striking-off) against the IBC Mek Global Limited was as a result of its own separate investigations and enquiries in the affairs of the IBC and was not in any way linked to the recent publications of the “hack” on the KuCoin platform which has been published recently.
In light of the situation involving KuCoin and the allegations concerned, the FSA would like to inform that whilst it is following the situation closely, it cannot at this point in time provide any positions on the allegations made or on the status of any investigations that could be in progress by any investigative authorities in any state.
All the above said, the FSA hereby draws the attention of the general public and investors to its Advisory in respect to entities claiming to be licensed or regulated by the FSA where the FSA sets out the scope of its regulatory ambit, such that its regulatory oversight extends only to the activities of persons, in or outside of Seychelles, that are licensed or regulated by the FSA under the relevant regulatory legislations. For more information on entities licenced and regulated by the FSA, please click here.
The FSA is cognizant that businesses operating the in sphere of financial technologies, or fintech, is highly susceptible to attacks by cybercriminals. In that regard, the FSA strongly urges investors and members of the public to undertake careful due diligence when evaluating an investment opportunity in fintech and to exercise extreme caution in respect to the services offered by unlicenced and unregulated companies.
The Financial Services Authority