Russian antimonopoly authorities launch another case over illegal Forex advertising
The case, which targets Yandex and Nefteprombank, concerns Forex advertisements on Yandex.Direct.
According to the Russian Forex law, which was signed by Vladimir Putin at the end of 2014, only companies with Forex dealer licenses issued by the Central Bank of Russia are allowed to advertise Forex services to Russian clientele. In the face of the law, Russian media is full of ads of non-Russian FX brokers. Russian authorities are trying to put an end to such law violations, with the latest example coming from the Moscow office of the Federal antimonopoly service (FAS).
According to a report by Russian newspaper Kommersant, the antimonopoly service has launched another case over illegal Forex advertising. The case targets Yandex and Nefteprombank. The authorities refer to advertisements distributed via Yandex.Direct. The ads urged investors to make use of services such as Forex market analytics and opening of a Forex demo account on nefteprominvest.ru. According to FAS, the ads violate the law on advertising, as they promote FX services offered by companies that are not licensed Forex dealers. In addition, the ads in question did not include any warnings about the risks associated with the financial instruments offered.
Prosecution may not be easy, however, as Nefteprombank officially stopped offering FX services to individuals in December 2015.
This is not the first time that the Moscow office of FAS targets such illegal ads. In August this year, FAS said they launched a case against Yandex and Process-A over alleged violations of the advertising law. Yandex, which distributed the advertisement in question, and Process-A, which is an advertiser, are alleged to have allowed dissemination of advertising of services that require licenses issued by the Bank of Russia. In addition, the advertisements did not display the full name of the provider of the services. That action referred to ads displayed on Yandex.Direct in March 2017. These ads promoted the services of an entity that was not licensed by the Bank of Russia to offer derivatives and/or Forex services. The advertisements were featuring text like “Forex online” and “binary options”.
That case, however, has stalled, as FAS said it intended to add an offshore entity – Smartex International Ltd, to the list of defendants.