Shares of Plus500 fell by as much as 44% after some UK accounts were frozen on money laundering regulations.
Shares London-listed Plus500 plunged after the company posted a note on its UK site for some (perhaps all?) customers saying it is suspending trading and freezing accounts until client verification steps are taken.
Shares of the forex broker fell as low as $429 from $775. Last week the company had a market cap of $1.3 billion so this wipes out around $600 million of shareholder value.
Woooosh!
From a 30% year-to-date gain to a 20% loss.
Here is the notice:
On the weekend, JPMorgan revealed it held 6.18% of the shares in the company.
Late last week, the company said it was experiencing a 'system overload' and that was causing some delays in client activities and that was causing delays for clients who were trying to upload/download documents.
Obviously, the market doesn't think this is just a temporary measure but a sign that something is amiss.
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