By Jemima Kelly
LONDON (Reuters) - Shares in retail FX trading shop Plus500 shed over a third of their value on Monday after the firm, a sponsor of Spanish football team Atletico Madrid, said some clients' accounts had been suspended as it sought to meet money laundering rules.
Plus500 (L:PLUSP), which runs most of its operations from Israel but has its official headquarters in London, said in a statement on its website that the restrictions would remain in place until it completed a review of the documentation and information it holds on its customers.
London-based hedge fund Odey Asset Management is the top external shareholder with almost 13 percent, according to Thomson Reuters data, while JP Morgan Asset Management holds a 6 percent stake.
A further statement from the company said it was in "close talks" with the FCA, Britain's financial watchdog, and assured shareholders that dividends would be paid in full.
"In addition, shareholders should note that Plus500's UK subsidiary, Plus500UK ... has in recent weeks been implementing certain enhanced client on-boarding and Anti-Money Laundering (AML) processes which have resulted in additional documentation checks being required," the company added.
By 1630 BST, shares in Plus500 were down around 37 percent, on track for their biggest daily fall in the firm's history.
"Until the review has been satisfactorily carried out, you will be unable to open any new trades on your account, deposit or withdraw funds," the statement said.
"If you have any open trades you will, however, still be able to freely service your existing positions with additional Maintenance Margin, although again, will not be able to withdraw funds until the review is complete."
It could not be immediately reached for further comment.
The retail FX sector is taking an increasing share of the $5-trillion-a-day global market in foreign exchange.
Millions of dollars' worth of losses from the sudden removal of a long-held ceiling on the Swiss franc in January caused much pain. Alpari UK were forced out of business.