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Mexican regulator CNBV acted irregularly in Ficrea fraud case, says court


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Mexican regulator CNBV acted irregularly in Ficrea fraud case, says court

A Mexican collegiate court has ruled that the country's banking and securities commission CNBV acted irregularly in administering a case concerning popular finance company Ficrea, which was accused of fraud by more than 6,800 people, El Economista reported.

The CNBV acted late in the Ficrea case despite knowing of the irregularities since 2011, the collegiate court said. The commission's auditors also mentioned in a 2013 report that Ficrea's operation is of high risk, but it only intervened in the management of Ficrea in November 2014.

Mexican authorities in 2015 ordered the arrest of the owners of Ficrea for money laundering and organized crime.

According to Jaime Cruz, a lawyer working on the case, the process started when CNBV received a claim for state responsibility in the Ficrea dispute. However, the regulator has maintained that it acted lawfully and exhausted all means before intervening in Ficrea.

The case was assigned to the Federal Court of Administrative Justice, which released a decision in favor of the CNBV. However, the ruling was challenged before the collegiate court, which ordered the former to review the case in line with its own ruling that the commission acted irregularly in the case.

"In this new ruling, it would be determined if said irregular activity was the cause of property damage suffered by the investor, and if so, it would determine whether or not the payment of the claimed liability should proceed," Cruz said.

The federal court's new ruling is expected to be issued in the next months.