Russian self-regulatory organization (SRO) for over-the-counter (OTC) financial instruments CRFIN said on Wednesday it has included two more forex brokers to its black list – EU Broker Age and KSF Trade. The two entities falsely present themselves.
Although EU Brokerage provides no information on its website regarding authorization, when contacted by potential customers and asked for information the broker presented a fake member certificate for CRFIN.
In addition, the two broker have failed to accept client’s funds. In addition, neither EU Broker Age, nor KSF Trade are transparent regarding the payments they make to brokers.
The SRO’s decision was taken after it received a number of complaints from citizens against the two entities. With the two new additions, the CRFIN’s black lists now includes 54 entities in total. The regulator warns that by engaging with any of the listed entities, investors are putting their money at increased risk.
Another Russian institution, the commission for the regulation of relations on financial markets KROUFR, also blacklisted EU Brokerage in late March 2016. At the time that, the regulator referred to EU Broker Age as being “fake” and as having dubious reputation. One reason for this is that the broker presents fake KROUFR certificate.
EU Broker Age claims to be based in UK’s London and Russia’s Moscow. It offers forex and contracts for difference (CFDs) trading services. No data regarding regulation has been provided.
On the other hand, KSF Trade is registered in the UK but is not licensed by the local Financial Conduct Authority (FCA). In fact, the FCA has issued a warning against the broker for operating unauthorized and unlicensed.
CRFIN, or Centre for Regulation in OTC Financial Instruments and Technologies, was set up in late 2010. It has disciplinary and control commissions which supervise and regulate its members, all of which are Russian forex brokers.
In mid-March this year, the Central Bank of Russia (CBR), which is in charge of the forex regulation in the country, decided to set up a register of all SROs in the country and to include several existing ones. However, CRFIN is currently not in the list, but is awaiting registration status. The CBR’s move is in line with the recently-introduced and on-going legislatory framework for the local forex market. As of 1 January this year, Russia-based forex brokers are not allowed to target local citizens, unless they have a license issued by the CBR. However, foreign forex brokers can still target Russian citizens even without a local license.
Many of the major Russian forex and binary options brokers already partake in SROs since one of the prerequisites for acquiring such a license is that brokers need to join a SRO with at least 10 participants. Finam Forex is the only entity to hold a Russian forex license, but there are more that are still on the waiting list.
Although the Russian forex market is fairly comparable with the world’s leaders Japan and USA in terms of trading volumes and clients, it is still dynamic and presents potential for growth. With the recent regulatory improvements, it may become more attractive and tempt even more investors.