Prague's most notorious exchange office loses license at last

A court has ruled in favor of the Czech National Bank, saying it is the bank's legal right to revoke the exchange office's license. Staff

Written by Staff Published on 11.11.2023 12:00:00 (updated on 12.11.2023) Reading time: 2 minutes

A leading exchange office network has met a dead-end in its lawsuit against the Czech National Bank (CNB). The dispute, which played out in a Prague Municipal Court this week emerged due to the network's repeated violations of the law, including the withholding of information from clients during transactions.

The exchange office's permit has now been revoked, reports, citing the CNB's press office.

The company, Chequepoint, operating primarily in Prague at central locations including Wenceslas and Old Town squares, found itself in repeated legal entanglements with the CNB through the years.

Fines were imposed for deceiving clients with false information about exchange rates and failing to provide transaction documentation, incurring a hefty fine of CZK 1.2 million which ultimately led to Chequepoint losing its license.

The legal battle saw the company contesting the bank's action, claiming the fines that had been imposed earlier should have sufficed. The court, however, ruled in favor of the CNB, dismissing objections raised by Chequepoint, emphasizing the bank's legal right to revoke licenses in the face of repeated or severe transgressions.

The court highlighted not only the company's persistent unlawful conduct but also its potential negative impact on the Czech Republic's reputation, particularly among foreign clients, who often fell victim to the company's exploitation.

A money-exchange leaders' shady track record

  • The company was one of the biggest money changers in the Czech market. In 2016, its transaction volume reached CZK 162.1 million for the purchase of foreign currencies and CZK 162.4 million for their sale.
  • The company repeatedly violated the law that determines the basic rules for the operation of exchange offices, failing to inform clients of the amount for which it buys euros from them in crowns.
  • According to the judgment, the company applied the euro exchange rate up to 40 percent lower than the standard rate, buying euros from clients for CZK 15.

The verdict underscored Chequepoint's practices involving the purchase of euros from clients at significantly deflated rates, often up to 40 percent below standard market values.

Chequepoint, recognized as one of the major players in the Czech exchange market, has not operated any exchange offices since 2018. Although the company can appeal to the Supreme Administrative Court, the verdict marks the company's exit from the market due to its license being canceled.

The Chequepoint Group Limited, based in Cyprus, has remained silent, withholding any official statement regarding the court's decision.

The latest development in the exchange-office saga marks the end of a notorious chapter in Prague's currency exchange market, characterized by the company's dubious practices, unfavorable exchange rates, and rude behavior of its staff.

Chequepoint was deemed the worst exchange office in Prague in 2016 by reporter and Honest Guide creator Janek Rubeš whose videos first drew attention to its practices.

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