The Ministry of Commerce and Investment, in collaboration with the Capital Market Authority and the Saudi Arabian Monetary Authority, announced the launch of an awareness campaign warning against dealing with suspicious websites that promote investment in securities without obtaining the required licenses from the competent authorities, including forex trading.
The campaign will include awareness messages from the three authorities, along with legal action against websites or individuals promoting such activities.
These authorities warn securities traders and the general public against dealing with suspicious websites whose operations may involve illegal activities, and which, through their advertisements on the internet and social media, promote investment opportunities and promises of financial gains and get-rich-quick schemes, which may expose many of their clients to scams, fraud, and significant financial losses.
Based on the Saudi Arabian Monetary Authority (SAMA) Regulations issued by Royal Decree No. (23) dated 23/5/1377 AH, the Capital Market Law issued by Royal Decree No. (M/30) dated 2/6/1424 AH, and in accordance with the regulatory mandates entrusted to both the Authority and the Commission.
Given the supervisory authorities’ commitment to educating the public and warning them against such suspicious acts and activities, they emphasize the need to exercise the utmost caution and vigilance to avoid the risks of investing, contributing, transacting, or trading any amounts in any securities or foreign exchange activities or transactions with any person, persons, institutions, companies, or entitiesor any websites (including social media), without verifying their legal status and ensuring they have obtained the necessary licenses or regulatory approvals from the supervisory authorities in the Kingdom of Saudi Arabia to conduct such business and activities.
Lists of legally licensed individuals and entities can be accessed through the Saudi Arabian Monetary Authority (SAMA) website (www.sama.gov.sa) and the Capital Market Authority (CMA) website (www.cma.org.sa).
In this regard, the Capital Market Authority has confirmed that it addresses websites promoting forex trading through three approaches. The first involves raising public awareness about the illegality of these websites and the risks of investing through them, The Authority is also working with the Saudi Arabian Monetary Authority to combat this activity; both entities have launched awareness campaigns warning against dealing with unlicensed and suspicious websites that promote financial investments or investments in securities.
The second approach taken by the Capital Market Authority involves coordinating with the relevant government agencies to curb this phenomenon by refusing to license the websites or companies operating in this field and by prohibiting them from advertising or sponsoring entities or events in the Kingdom. The third approach is to urge individuals who are offered such investments or receive marketing messages about them from someone in the Kingdom to report this to the Authority so that it can take the necessary measures with the relevant authorities in accordance with their respective jurisdictions.
The Capital Market Authority clarified that it has shut down a number of websites in coordination with the relevant authorities; however, given the ease with which new websites can be created, the Authority emphasizes that the best way to curb this phenomenon
is raising awareness of their risks, which the Authority is working on in collaboration with the Saudi Arabian Monetary Authority and the Ministry of Commerce and Investment.
