SEC Fines Israeli Education Provider $130,000

The Financial Commission / Regulatory Actions / SEC Fines Israeli Education Provider $130,000

The US Securities and Exchange Commission (SEC) has announced charges against an Israeli education provider called Tradenet Capital Markets Ltd. that provided day trading services to its clients with unlicensed investment activity, according to a notice published on its website.

The company has been fined $130,000 for ignoring the registration requirements designed to provide investors with the information necessary to evaluate securities transactions. The company also did not properly evaluate their customers from a suitability perspective.

According to the regulatory notice “Tradenet sold investors packages of materials that claimed to be for the purpose of educating investors about day trading but also paid investors a portion of net profits from simulated trades conducted in a funded trading account provided as part of the packages.”

As set forth in the order, Tradenet charged from $500 to $9,000 for the educational packages that included the simulated trading accounts.  According to the order, investors whose portfolios increased in value received payouts equal to a percentage of the simulated net profits, but if the value of the portfolio decreased by a certain amount, the funded trading account was closed.

Investors and those wishing to learn how to trade the markets must also be vigilant about the registration requirements and licenses of their education providers, in order to make sure they are being provided with accurate information and sound education materials.

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