Philippines SEC Charges eToro with Offering Unregistered Securities

Jimmy Aki
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On April 4, the Philippines Securities and Exchange Commission (SEC) announced that it was illegal for eToro to offer securities trading in the country. According to the regulator, eToro is not registered as a corporation in the Philippines and lacks the required operating license.

Philippines SEC Warns eToro Representatives of Heavy Penalties

The SEC advisory was made public, notifying local investors that eToro allows residents to create accounts on its exchange to invest in and trade unregistered securities.

Philippines SEC reiterated that while eToro is a registered broker/dealer in different jurisdictions, the exchange must comply with the Philippines’ financial regulations before offering securities and investment products.

Philippines SEC
Excerpt of the Philippines SEC warning notice on eToro

The notice reads,

“Based on the Commission’s database, the operator of the platform ETORO is NOT REGISTERED as a corporation in the Philippines and OPERATES WITHOUT THE NECESSARY LICENSE AND/OR AUTHORITY to sell or offer any form of securities as defined under Section 3.1 of the Securities Regulation Code (SRC), to engage in the business of buying or selling securities or as a broker or dealer as provided under Section 28 of the SRC, or to create or operate an exchange for the buying and selling of securities as provided under Section 32 of the SRC.”

The Philippines regulator emphasized that any individual acting as a promoter, salesperson, or representative of eToro could face up to 5 million Philippines Pesos (approximately $88,300) or a 21-year prison sentence for violating securities law.

This SEC advisory follows a similar warning notice given to Binance on November 28, 2023, and a blockade briefing on March 25, 2024.

At the time, the regulator had accused Binance of promoting campaigns of its products and investment offerings without securing a license as required by Republic Act No. 8799 or the Securities Regulation Code (SRC).

In the notice, the Philippines SEC Chair Emilio B. Aquino stated that the regulatory body believes that residents’ continuous access to Binance websites and mobile applications “poses a threat to the security of the funds of investing Filipinos.”

As such, the agency requested that Google and Meta block all marketing campaigns related to the crypto exchange in the country.

Philippines SEC Continues Clampdown on Unlicensed Investment Platforms

The Philippines SEC has been taking action against unlicensed investment platforms in the country, which is a step to ensure compliance with the Securities Regulation Code.

On March 7, local media outlet Bitpinas reported the Philippines National Telecommunication Commission (NTC) blocked the websites of crypto companies, including MiTrade and OctaFX, for violating regulations enforced by the SEC.

The NTC’s action was a response to the SEC’s request to restrict the websites of crypto platforms operating without a license in the Philippines.

According to the SEC Chair Emilio Aquino, the NTC’s enforcement will prevent investment scams and protect traders in the country.

“The SEC and NTC will continue to work closely together to take similar actions on other platforms facilitating illegal investment-taking activities and other predatory financial schemes,” he added.

About Jimmy Aki PRO INVESTOR

Based in the UK, Jimmy is an economic researcher with outstanding hands-on and heads-on experience in Macroeconomic finance analysis, forecasting and planning. He has honed his skills having worked cross-continental as a finance analyst, which gives him inter-cultural experience. He currently has a strong passion for regulation and macroeconomic trends as it allows him peek under the global bonnet to see how the world works.