Resolution no. 21405

Order, pursuant to article 7-octies, paragraph 1, letter b) of Legislative Decree no. 58/1998 ('Consolidated Law on Finance') to cease the infringement of article 18 of the Consolidated Law on Finance performed through the website https://it.fsmsmart.net

LA COMMISSIONE NAZIONALE PER LE SOCIETÀ E LA BORSA
[THE NATIONAL COMMISSION FOR COMPANIES AND THE STOCK EXCHANGE]

HAVING REGARD TO Law no. 216 of 7 June 1974 and subsequent amendments and supplements;

HAVING REGARD TO Legislative Decree no. 58 of 24 February 1998 ('Consolidated Law on Finance') and subsequent amendments and supplements;

HAVING REGARD TO Resolutions no. 20825 of 20 February 2019 and no. 21244 of 21 January 2020 whereby Consob ordered, pursuant to article 7-octies, letter b), of the Consolidated Law on Finance, the company FSM SMART Ltd, with its registered office in the Marshall Islands, to cease its infringement of article 18 of the Consolidated Law on Finance taking place respectively through the www.fsmsmart.com and www.fsmsmarts.com websites;

HAVING ESTABLISHED that, from checks on the https://it.fsmsmart.net website, it emerged that:

i. the https://it.fsmsmart.net website is in Italian and provides a telephone number ("+39800727401") and an email address (cs-it@fsmsmart.net), specifically dedicated to Italian investors;

ii. potential investors are offered the opportunity, subject to registration with the site and opening of an account via the specific form available online, to trade on CFDs with underlying currencies, shares, indices and commodities, through the Meta Trader 4 platform;

iii. in order to be able to trade, a cash investment is required to be paid into an account opened online.In particular, the website offers five types of account, called "Beginner", "Silver", "Gold", "Gold+" and "Platinum", distinguished mainly by the amount of the minimum deposit and the benefits paid to users;

iv. the company "FSM Smart Ltd" with an alleged representative office in Switzerland is indicated in the "Terms and Conditions" section, and the same section also indicates that "This Agreement is governed by and shall be construed in accordance with the laws of the Republic of the Marshall Islands";

WHEREAS the activity carried out through the https://it.fsmsmart.net website can be classed as the provision of investment services as referred to in article 1, paragraph 5 of the Consolidated Law on Finance, insofar as clients are offered the opportunity of opening a trading account against which purchase and/or sale orders for financial instruments can be issued;

WHEREAS the above transactions, carried out through the https://it.fsmsmart.net website are ongoing and aimed at Italian investors, since the said website is in Italian;

CONSIDERING that the company FSM SMART Ltd that is mentioned on the website is not authorised to provide investment services to the Italian public because this company does not appear in the register kept by Consob pursuant to article 20 of the Consolidated Law on Finance;

HAVING REGARD TO the fact that the provision of investment services and activities is reserved for the authorised entities referred to in art. 18, paragraph 1 of the Consolidated Law on Finance, pursuant to which, 'The professional provision of investment services and activities for the public is reserved for investment firms, (and) banks ...';

HAVING ESTABLISHED, therefore, that the operations in question qualify as the professional provision of investment services to the Italian public, in infringement of art. 18, paragraph 1 of the Consolidated Law on Finance;

HAVING REGARD TO the fact that, according to the provisions of article 7-octies of the Consolidated Law on Finance - 'Powers to counteract abusive practices' - CONSOB 'may, with regard to anyone who offers or carries out investment services or activities over the Internet without being qualified to do so pursuant to this decree: […] b) order the cessation of the infringement';

CONSIDERING it therefore necessary, in the light of the foregoing, to adopt this resolution immediately for reasons of urgency;

RESOLVES:

To order the cessation of the infringement of article 18 of Legislative Decree no. 58/98 also carried out through the https://it.fsmsmart.net website, consisting in the offering and provision of investment services and activities to the Italian public.

This Resolution shall be brought to the attention of those whom it concerns and will be published in the Consob Bulletin.

This measure may be appealed before the Regional Administrative Court of Lazio within 60 days of the date of service.

June 17, 2020

THE CHAIRMAN
Paolo Savona