ČNB revokes licences of three Prague “zero commission” currency exchange offices
The Czech National Bank (ČNB) has revoked the licences of three currency exchange offices in central Prague for violating new obligations stipulated under the Foreign Exchange Act. It is the first time the Czech central bank has taken such action.
The exchange offices in question are operated by PEMEX change, Exclusive Change, and CHIVAS INVEST. Apart from revoking the licences, the ČNB also imposed fines ranging from 2 million to 3 million crowns on the companies.
The Prague City Council has promised to shut dishonest exchange offices that advertise “zero commission” rates targeting foreign visitors to the Czech capital. In reality, the rates are around 16 crowns to the euro while the official exchange rate set by the ČNB is over 25 crowns per euro.
Two such Chequepoint outlets were closed in November 2018. Prague City councillors said this January they were looking at around two dozen other problematic currency exchange offices which may follow suit.
Exchange offices set their rates independently of the official exchange rates announced by the ČNB. The Foreign Exchange Act allows customers up to three hours to cancel a currency exchange transaction they find to be highly disadvantageous and get their money back.
Inspections by ČNB staff revealed PEMEX change, Exclusive Change, and CHIVAS INVEST posted confusing information on specific, so-called VIP rates, which is expressly prohibited by law. Their exchange rate lists also did state as required by law their customers’ right to cancel the transaction within three hours.