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How to create a Inverstment Service/Neo Broker in TRNC

Onisaga

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May 22, 2021
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Hello, I will just think loud about my dreams.

Me and my buisness partner want to start a Investment Service or better a Neo broker, where people are able to buy Shares/ETFS/Options/Crypto/(if possible forex). The project is now at a point where we need to decide about the jurisdiction.
I face at the moment a few problems and want to know how you would set it up is maybe TRNC the wrong adress?


The main question is how we can get access to trading venues like Xetra, tradegate etc., if we re not regulated?

I thought about the TRNC as jurisdiction, because of serval reasons but still have a question.

1. they doesnt apply the CRS, so we doesnt need exchange informations about our customers with other countries. That means we can book capital gains tax as a liability.

2. The transfer of money from cyprus to turkey is quite easy so we could use a turkish bank where people can deposit their money on the company account. The idea was that we could later expand from turkey to other european countries with sub companies.

3. I dont know how we would be regulated there. I only now that in Cyprus they apply the CYSEC.

If its not possible to access trade markets from there I thought about another offshore company based f.e. in Cayman Islands which only have the company in TRNC or if not possible a company in a third party country as customer.

With best regards
ONISAGA
 
I thought about the TRNC as jurisdiction, because of serval reasons but still have a question.

1. they doesnt apply the CRS, so we doesnt need exchange informations about our customers with other countries. That means we can book capital gains tax as a liability.
It also means you will only attract clients with money to hide, which might sound fun at first but when you start losing access to banks, payment processors, and law enforcement is knocking on the door, the party stops.

Who else would put their money with a financial service provider in an unrecognized puppet state with no regulations and no protections?

2. The transfer of money from cyprus to turkey is quite easy so we could use a turkish bank where people can deposit their money on the company account. The idea was that we could later expand from turkey to other european countries with sub companies.
While you can probably incorporate subsidiaries in other jurisdictions and mistakes can happen with some banks, no bank is going to accept it because TRNC companies aren't real companies since TRNC is an unrecognized state. It would be like forming a company in the Republic of Onisaga and expect anyone to take it seriously.

3. I dont know how we would be regulated there. I only now that in Cyprus they apply the CYSEC.
There is no regulator for this in TRNC.
 
"It also means you will only attract clients with money to hide, which might sound fun at first but when you start losing access to banks, payment processors, and law enforcement is knocking on the door, the party stops."

This is definitely a problem, but this is why I want it legal, according to German bafin, this would be no problem as long people go by theyeir own to this site and I don't do active commercials here. In the Eu it intervenes the third country regulation which is the same like Germany.

At the same time I can't even imagine to lose access to banks in TRNC because they doesn't apply the CRS and even if I use a bank account which uses them, it could be a company with a contract to the Broker maybe even not in TRNC, so if they wanna let me lose the access they need to inform the company first.
The big question is how law enforcement will knock on the door in a country where they doesn't have access.

"Who else would put their money with a financial service provider in an unrecognized puppet state with no regulations and no protections?"

According to studies only 7% of users use security as argumentation for using a investment service. Approximately 70% have the argument that easy user friendliness, design and cost are primary factors.
 
" It would be like forming a company in the Republic of Onisaga and expect anyone to take it seriously."

This is definitely not true, TRNC is only recognized by Turkey, so there is bank cooperation between these two states and even turk banks operate there.

" There is no regulator for this in TRNC."
This is a good news, so TRNC is still a fav.
 
Sounds like the worst idea I've ever heard.

You are literally talking about opening a laundromat broker dealing wit exclusively dirty money, in a garbage non-existent jurisdiction and try to rationalize why it is a good idea.
This MAYBE would have been a good idea 20 years ago, now you will certainly face legal issues and possibly jail if you get unlucky enough and accept money from the wrong person.
 
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" It would be like forming a company in the Republic of Onisaga and expect anyone to take it seriously."

This is definitely not true, TRNC is only recognized by Turkey, so there is bank cooperation between these two states and even turk banks operate there.

" There is no regulator for this in TRNC."
This is a good news, so TRNC is still a fav.
The occupied side of Cyprus is recognised only by Turkey, it’s mainly used by criminals. You won’t be able to offer services in any other state. No sane person would put money in a provider in an unrecognised place with mo regulation, unless they fall under the criminal category.
 

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