CFDs or contracts for difference are very risky investments with leverage. So risky, in fact, that the Dutch AFM has banned, via a law, the riskiest variants with leverage above 1:30. This provision was widely circumvented by selling CFDs with a leverage of 1:200 through brokers from Cyprus, but several Dutch courts ruled against this in 2021. Investors got their money back.

A broker from Vanuatu?

What we have since seen is multiple other ways to sell still the riskiest form of CFDs with leverage higher than 1:30 to Dutch people, through the most exotic structures. Cypriot companies are looking for shortcuts. For example, if you, as a Dutchman, look up the CFD broker “LegacyFX” in your browser (, you will arrive at the domain Below you can see that this is a broker based on the remote island of Vanuatu, not the first place you think of for complicated financial products. The owner of the site is AN All New Investments Ltd, a Vanuatu-based company. But is this correct?

Or from Cyprus after all?

No, this is clearly a structure set up to evade the Dutch AFM decision. As it turns out, if you type in the URL, you arrive at a website that does look very much like the website of the broker from Vanuatu. And if you look at the bottom of the website you will see that the site is owned by a Cypriot firm called A.N. All New Investments Ltd. Yes, that is exactly the same name as the company in Vanuatu, the only difference being the two dots in the name. How does that work? Let’s say they are twins with the same mother, and the mother gave the twins the same name at birth, except for the two dots, and one stayed in Cyprus to stay with the family and the other was sent to Vanuatu on his own. In doing so, you should not think that there is really a business in Vanuatu. No, there is a post office box there, but not a serious office. We call such a thing a letterbox firm.

So what can you do if you have gone into business with this broker from Vanuatu, who has clearly thought in advance how they can approach the Dutch market without recognizing Dutch law? The answer is in the AFM decision. In fact, there is also an anti-evasion provision in that. This clause reads as follows:

“Ban on participation in evasion activities

It is prohibited to deliberately participate in activities that have as their object or result circumvention of the requirements of Article 2, and likewise to act as a substitute for the CFD provider for this purpose. “

Now you may be thinking: such a broker from Cyprus, would they also take clients from Cyprus? And do they do it nicely by the rules with their own countrymen? Well, we can check that by using a handy little tool – a VPN server – to pretend we live in Cyprus. And then we get the following message:

Legacyfx is not available in your country.

We are currently not accepting customers who are residents of Cyprus

That is strange, of course. Vanuatu should have reported this to the Dutch, because they do not have a license for the Netherlands, but the Dutch are presented with the Vanuatu website. Apparently, the Cyprus branch does not have much confidence in its own products and seems better off offering its services abroad, far away from its own regulator. And for the Dutch, they set up the letterbox firm in Vanuatu. Still curious, they have a license from Cyprus, but they don’t sell anything in Cyprus, and the Netherlands is served through an empty shell. So what does the regulator actually monitor? Not on Vanuatu anyway.

So, if you’re wondering whether you stand a chance of being compensated for your losses if your money has been evaporated by LegacyFX’s investments, our answer is: here’s a Cypriot broker at work trying to circumvent a clear legal regulation, but the AFM has thought about it in advance: that’s not allowed at all. The Dutch courts can pierce this construction.