Bank of Russia Licensing FX Brokers

Bank of Russia Licensing FX Brokers

In general condition, the Russian market operates through its strict centralized nature and governmental influence on its development. Since the Forex industry gained its popularity and spread to a Russian market as well, the majority of offered trading services was managed through offshore brokers. The industry players maximum participated to Russian self-regulatory organization CRFIN, yet it was never a broker’s obligation to enter.

In addition, earlier in 2015, the first deputy head of the Central Bank compared the forex market to a casino and said that the regulator is not interested in the onward development of such companies in Russia.

However, starting from 1 January 2016 Forex brokers that operated in Russia were required to get a license from a Bank of Russia, as the government understood the necessity of regulation. This statement affects a number of brokerages that expressed concerns about their legal operation in Russia from now on. The board director of CRFIN mentions that the new law will protect forex brokers and prevent fraudulent entities, as well as set active clients' interest towards investment with a reliable broker. Years of non-licensed brokerage activity finally got an implementation of a regulatory regime.

The application of the companies towards their license receiving appealed actively by the largest brokerages, as the companies welcomed the development of a regulated environment in Russia. Back in 2016, when forex brokers were about to receive professional licenses in the securities market, the first firms Alpari and Forex Club were named as the largest players in Russia, while the first firm was Finam investment holding.

Among required obligations and new laws toward Forex Brokers, the Bank of Russia set a capital minimum amount of RUB 100 million ($1.5 million), high qualification criteria, strictest supervision of operation along with a necessary requirement towards top management of the company and its staff members. The companies are also obliged to pool funds into a compensation fund with a purpose to reimburse clients in case of broker’s insolvency. In addition to these requirements, earlier this year 2018, the authority updated its statements and requirements towards Forex leverage limitations and looks forward to setting up a maximum level of 30:1 and allow trading strictly on forex related products. That step was a quite logic due to a recent introduction of a leverage cap by European authorities and amendment of the trading offer accordingly. 

However, the members of Forex organization operating in Russia were rather disappointed, as typically assets offering to diversify its exposure to the volatility of various classes and a much higher level of leverage. In fact, until now Bank of Russia did not issue or register a large number of licenses, as this may take place as a general Russian conservative opinion about forex industry or just a consequence of a better offshore establish proposal in Russia. Since the beginning and until now there were only nine brokers which obtained its legal licenses of forex dealers from a Russian central bank.

The opinion of experts mentions that in fact, the Russian forex brokering is a very specific case, since the Central Bank did regulate brokers until now, gave its permission to operate, yet the companies found their way out to maintain “better process” in their own interest. As the licensed companies are mainly international holdings with numerous subsidiaries, the majority of trading accounts indeed were opened with offshore entities, while Russian jurisdiction branches took a responsibility mainly on advertising. The purpose of these is to attract new clients and ensure constant influx, while the account management goes through an offshore specification. The regulatory reports that brokers submit were consistent of performance data, while the initially small number of accounts were operated throughout Russian entity and hiding its real nature.

In conclusion, it came to the point that the latest breaking news just before the end of 2018, appeared to revoke of five licenses, of the largest forex companies operating in Russia and providing clients to markets and trading. As the Central Bank reporting, the reason for the decision was that these companies repeatedly violated regulations and legislation of the Russian Federation. (Read on more about 5 licenses annulation by the link).

The representatives of revoked companies were surprised by the Central Bank action, as the brokerages just a day before participate into summit where the trading markets were discussed too and nothing showed a potential of regulatory increase. Therefore, Russian trading industry does not know what to expect next, however, it’s obvious that the latest actions and plans show that the Bank of Russia made it seriously to clean up the market and develop further trading offering in a more trustful, sharply regulated way.

The current increase of regulation and revoke of licenses that brokers were definitely not ready to face, will affect the operation of brokers in Russian markets, their development and specifically the legal side of service delivery in Russia itself. Russian economy had always shown its centralized way of operation, and recent action towards the relatively young Forex Russian market will act on a better way towards the traders, as these steps mean a serious claim to enable clear and well-regulated operation of Brokerages in Russia. 

What is more, the last official permit was received by an Alfa Forex company just a week ago in December 2018. The broker previously accepted Russian clients throughout its Cyprus subsidiary Alfa Capital Holdings Cyprus Limited and has a long history of operating in Russia itself. The newly licensed Russia broker mentioned that the company applied for its license in May, and already by December became an official member of the Association of Forex Dealers. This act confirms Bank of Russia concerns and forward look on trading development and regulation of the Forex offering within Russia territory, as well as a growing potential. Yet, from now on Russia strongly welcomes only those companies that deliver clear and transparent brokerage operation throughout compliance with Bank of Russia regulation. 

eToro expands its Crypto Trading capabilities

eToro as one of the largest and some of the most popular social trading brokers that deliver thousands of opportunities to invest, trade, copy or be copied expand its capabilities even further.

Recently, social platform eToro announced its acquisition of Delta App that allows to monitor and track thousands of Crypto markets through its dynamic picture and comprehensive market charts. Delta App makes decisions better by providing some one-of-the-kind portfolio tracking and pricing data processing which fits perfectly well with eToro strives to develop Cryptocurrencies trading.

eToro Cryptocurrencies

eToro has shown its aim to accelerate Crypto products offering, constant growth by adding new elements that enhancing eToro Crypto trading offering as a whole.

Also, a short while ago eToro established a FinTech company eToroX as a forefront of the Crypto and Blockchain technology to revolutionize the financial world and enable new ways for asset transactions. Therefore, acquisition of Delta App will enhance eToroX capabilities by collaboration between technologies bringing the possibility to track all your investment in one place starting with cryptocurrencies and multi-asset as well. eToro real Cryptocurrency trading available for USA Traders on exchange, Visit eToroX website for more details.

So by bringing the world of cryptoassets to a wider possibilities eToro continues with its strives to enable strength and advantages to their powerful capabilities and numerous global traders they serve, or even those who want to engage into the Crypto trading with eToro.eToro acquire Crypto traker Delta App

In fact, eToro is not only an investing platform that gives great options to global traders of different sizes, portfolios or even with zero experience, also broker gives great access to the assets together with commission-free stocks, competitive pricing and some of the unique possibilities. You may read full eToro Review by the link and get to know about their general offering in a detail, as well you may check other CySEC regulated brokers for your consideration.

eToro Updates on Distribution of Spark Token

Online broker eToro has issued an update on the distribution of Spark tokens. The broker is supporting the distribution of the Spark tokens by the Flare network to all eligible users.

eToro
eToro

According to Flare’s latest announcement, there is now a somewhat definite distribution window: the period between October 24 and November 6, 2022. Flare also added that "The exact date will be dependent on feedback from exchanges."

eToro reminds its clients about the eligibility requirements that users of the investment platform must meet in order to receive Spark tokens or the USD equivalent value:

  • Users must have held the XRP tokens consecutively between 00:00 on 11.12.2020 GMT, and 00:00 on 13.12.2020 GMT. XRP tokens that were pending deposit or withdrawal at the time of the snapshot were not counted towards a user’s XRP balance. The broker records at the moment of the snapshot are regarded as conclusive evidence.
  • The snapshot did not include leveraged positions, CFD positions, short positions, CopyTrade positions or Smart Portfolio positions in XRP, or any cross transactions of XRP with other crypto assets and/or with currencies or such transactions otherwise classified as CFD on the platform.
  • Holders of XRP in the eToro Money crypto wallet (formerly “eToro Wallet”) were not included in the snapshot and therefore are NOT eligible for the Spark distribution.
  • Users must be fully verified at the time that the snapshot was taken, and must still be fully verified at the time of each Spark or USD distribution.

The Spark token distribution program supported by the broker is subject to regulatory requirements, is not guaranteed to happen, and could be accompanied by further terms, as applicable to eligible users and the mechanics of the distribution. The eligibility criteria and the manner and timing of such distributions are therefore subject to change.

Eligible users have received emails from us in the past, informing them of their eligibility.

The broker notes that its clients in the US who held XRP at the time of the snapshot are still eligible to receive Spark tokens, despite XRP no longer being available on the US platform.

About eToro

Etoro is an Israeli multinational social trading and multi-asset investment company that focuses on providing financial services. The headquarters are located in Central Israel, with registered offices across Cyprus, the UK, the US, and Australia.

eToro provides a wide selection of stocks, currencies, commodities, crypto assets, ETFs and indices through its own innovative investment platform. Using professional tools and analyses on eToro, eToro clients can track and invest in a variety of financial instruments.

For more information read our detailed review on eToro.

eToro launches diversified ESG portfolio

eToro launches a portfolio offering exposure to companies leading the way in ESG, offering a diversified approach with stocks from 11 industry sectors

Follows the debut of ESG scores for over 2,700 stocks on eToro

etoro
eToro

Online broker eToro has announced the launch of ESG-Leaders, a portfolio offering retail investors long-term exposure to companies leading the way in environmental, social and governance (ESG) best practices.

The portfolio is built by identifying the four companies with some of the highest ESG scores for their sector across 11 industry sectors, while also taking into consideration market capitalisation, liquidity, and sell-side analyst ratings. The 11 industry sectors covered are consumer discretionary, consumer staples, energy, financials, healthcare, industrials, information technology, materials, real estate, telecommunication services, and utilities. Names in the portfolio include Nivea’s parent company Beiersdorf, ABB, Nvidia and Telefonica.

The portfolio launch follows the introduction of ESG scores to the eToro platform for over 2,700 stocks. Powered by ESG Book, a global leader in ESG data and technology, the ESG scores combine the most up-to-date market news, NGO signals and company-reported information enabling users to consider environmental, social, and governance factors when building their portfolios.

eToro’s Smart Portfolios offer investors exposure to various market themes. Bundling together several assets under a defined methodology, and employing a passive investment approach, eToro’s Smart Portfolios are long-term investment solutions that offer diversified exposure with no management fees.

Initial investment starts from USD 500 and investors can access tools and charts to track the portfolio’s performance, while eToro’s social feed will keep them up-to-date on developments in the sector. For now, this portfolio is not available to US users.

7th China Forex Expo in Shenzhen

After a great success of 6th China Forex Expo 2017, 7th China Forex Expo 2018 is back and will take place on May 18-19th 2018 at Great China International Exchange Square of Shenzhen. This event will last two days and it will be prepare for brokers, traders, investors, affiliates, fintech companies, blockchain companies and media.

As the new European regulatory frameworks such as Markets In Financial Instruments Directive II published by The European Securities and Markets Authority severely restrict the European forex market, traders are searching for other better options in offshore zones and new markets like China. Also a great opportunity has appeared for offshore brokers, affiliates, money managers, technology and specialized services providers as China market has become more active today.

China Forex Expo is one of the most influential and professional expos in China. The event covers forex, CFDs, commodities and precious metals. The main goal of the expo is to bring together active forex market traders from all over the world and to promote products and services to the international market.

Event's agenda will present a solid mixture of networking and educational opportunities. The speake list includes market professionals from China and other countries, including Wendy Tao of Invast Global, Alejandro Zambrano of Amana Capital, StephenInnes of OANDA and the others. Among the topics, the attention will focus on predictions for China's economy, the importance of market intelligence and also the opportunities for businesses in China.

Halifax Investment Services has gone into administration

According to the notice from insolvency specialist Ferrier Hodgson, Halifax Investment Services in Australia entered administration on November 23. The partners of the Ferrier Hodson were appointed administrators of the Australian brokerage.

Halifax Review
Halifax Investment Services Pty Limited provides investment management services in Australia. It offers various financial products in a range of asset classes, including stocks, options, futures, foreign exchange, and contracts for difference; and trade finance and currency exchange services. Halifax Investment Services Pty Limited is based in Sydney, Australia and regulated by Australian Securities and Investments Commission.
As for now, the website of the Halifax Investment Services is closed for "maintenance". Clients of the online brokerage state that their investments have been frozen right after the company went into administration.
According to the statement posted on the Ferrier Hodgson website, the partners Morgan Kelly, Stewart McCallum and Phil Quinlan were appointed voluntary administrators by the Halifax Investment Services board of directors. This action had to be taken as the Company is unlikely to be able to meet its financial commitments. Administration seems to be the first step in business recovery and its protection from being broken up.
Also, the statement says that the newly assigned administrators are assessing the best course of action and focusing on the best outcome for investors as investors are the primary concern at the time. They are conducting an urgent investigation into the business operations and promise to keep all the stakeholders, creditors, investors and employees updated on any developments. 

You can read our review on this broker here

FSCA temporarily suspends JP Markets forex trader’s licence

FSCA has temporarily suspended forex trader's license

The Financial Sector Conduct Authority (FSCA) has temporarily suspended the financial service provider (FSP) licence of a forex trader, JP Markets. The regulator investigates the trader’s alleged breach of certain laws in the financial sector. During the period of JP Markets provisional suspension, it is also not permitted to take on any new business. 

According to the official statement, there was a conflict situation between the trader and its clients. It has allegedly been tampering trading conditions to minimise some high-level clients’ earnings and instead maximising its own. The trader has also amassed a huge number of complaints from its clients for the past year. The clients mostly complain about company’s failure to honour client withdrawal requests and losses due to not having a constant access to the trading platform. Due to these events, the FSCA stated that there is reasonable belief that substantial prejudice to clients or the general public may occur if they continue rendering financial services.

The regulator is now moving to have the trader liquidated, and has filed papers to this effect with the High Court in Johannesburg. While on suspension, JP Markets are not permitted to take on any new business or clients or render any services; however, it is not prohibited from processing client withdrawals. The firm had to inform all affected clients of the recent events. The FSCA’s investigation is currently on-going and any new findings will be made public.

JP Markets logo

The public is further warned that JP Markets is not authorised as an OTC derivative provider and therefore is not permitted, as a regular feature of its business and acting as principal to; originate, issue, sell or make a market in OTC derivatives. The investigation in respect of JP Markets is currently on-going.

The head of the FSCA business supervision division, Kedibone Dikokwe, explained the nature of the investigations. According to her, JP Markets allowed its clients to access a platform to trade in contracts for difference (CFDs), and to deposit their funds into its bank accounts. These deposits would then seemingly allow the clients to trade in forex CFDs, enter transactions, and make profits or losses depending on how the underlying forex exchange rose or fell. However, it transpired these clients were not trading on an online decentralised global financial market, but merely on a software application that the firm acquired ready-made and pre-programmed, that recorded these trades. According to Dikokwe, these clients were in fact purchasing CFDs issued by JP Markets, for which the trader by law required an OTC derivative provider licence. Without one, the trader is not permitted, even under regular features of its business, to originate, issue, sell or make a market in OTC derivatives.

FSCA warns the public against Tradehedges 

In another case, the FSCA also warned the public against entering in any financial business with Tradehedges. It received information by concerned members of the public that this trader claimed to be an authorised FSP, operating under a false FSP number and licence, and allegedly displayed a certificate claimed to have been issued by the FSCA back in 2017 when it was still the FSB (Financial Services Board). According to FSCA, it researched its records, and subsequently found that Tradehedges is not an authorised FSP nor a juristic representative, and no records of any applications for such exist, or of the licence number in question.

The FSCA again strongly advised members of the public to check that a trader is registered with it and to verify which categories it is permitted to trade and advise in, before entering any business or trade agreements, or depositing any funds to into any bank accounts these traders proffer.

FCA has issued a warning against Forex broker Tradepro Capitals

FCA Regulator

The UK’s Financial Conduct Authority has updated its warning list with Tradepro Capitals – a company that is not authorised by the regulator and is targeting people in the UK. Based upon information the FCA holds, Tradepro Capitals is carrying on regulated activities which require authorisation.

The Financial Conduct Authority (FCA) is a financial regulatory body in the United Kingdom, but operates independently of the UK Government, and is financed by charging fees to members of the financial services industry. The FCA regulates financial firms providing services to consumers and maintains the integrity of the financial markets in the United Kingdom.

Tradepro Capitals logo

Tradepro Capitals provides you with high-end trading instruments, such as 62 currency pairs & Crude Oil and a wide range of stock indices. The company is owned and operated by Tradepro Capital Markets Limited, based in St. Vincent and the Grenadine. This is a jurisdiction where Forex license is not required. Moreover, local authority doesn’t issue forex licenses, which means that the broker is most probably a fraud.

Also, Tradepro Capitals claims to be based in London, the UK, however, it is not regulated by the UK's FCA. We have also found a bunch of negative review about this broker, where people state the firm refuses their withdrawals and doesn't return their messages.

Considering all the above, we don’t recommend this broker due to the lack of financial regulation and the warning from the authorities. All brokers licensed by the UK's Financial Conduct Authority are under the umbrella of the Financial Services Compensation Scheme (FSCS), which can pay up to £50,000 per client. Unlike FCA-licensed brokers, unregulated ones are not obliged to keep their clients’ money in segregated accounts. You can read our review on this broker here.

CONSOB has banned Globalix and Axe Invest brokers

Consob logo

Italy’s financial markets and services provider regulator CONSOB (Commissione Nazionale per le Società e la Borsa) has updated its list of forex brokers who are not licensed to operate in Italy. Globalix and Axe Invest are happened to get into the list. These firms have been offering investment services and activities to the Italian public without being authorized in the country.

Commissione Nazionale per le Società e la Borsa (CONSOB; Italian Companies and Exchange Commission) is the Italian governmental authority responsible for regulating the Italian securities market. The regulator is also responsible for the Italian stock exchange, the Borsa Italiana.

These two brokers have one important thing in common, they are both registered offshore in Marshall Islands and it is also a reason why they both should be avoided. 

Globalix logo

Globalix is a forex broker, owned and operated by Globalix Ltd. The firm doesn't disclose any regulatory information and only deludes investors, claiming to be located somewhere in Europe. In addition to CONSOB's warning, Globalix has been banned in Spain by its local CNMV.

Axe Invest logo

As to the Axe Invest, this Forex broker also attempts to confuse the traders by providing British and Swiss contact numbers on its website. However, the company is not regulated or authorized to provide financial services in Europe. 

Investing with a properly regulated broker is crucial for the safety of any investment. You can choose among Swiss brokers regulated by FINMA or those authorized in the UK by its FCA.

Also, you can share your trading experience with Globalix or Axe Invest by commenting on this post.