Russian bill for simplified identification of Forex brokers’ clients gets withdrawn

Maria Nikolova

Neither the central bank, nor the government backed the initiative to provide Russian Forex dealers with a simpler way of client identification.

A legislative proposal that would have seen Russian Forex brokers (or Forex dealers, as their official designation says) benefit from a simplified client identification procedure has faced insurmountable opposition in the Russian Duma.

Research by FinanceFeeds shows that the bill has been withdrawn earlier this month by the authors of the legislative piece. This happens after the Government and the Central Bank objected to the bill. The Central Bank said that the proposal was premature, whereas the Government’s objections center around AML requirements.

Let’s recall that, according to the authors of the document, as of May 15, 2018, the number of clients of the licensed Forex brokers in Russia was 3,539. At the same time, there were about 200 unlicensed companies that offer Forex services to Russian clients. These companies usually operate offshore. The total number of Russian clients trading through platforms of brokers that do not have licenses issued by the Bank of Russia stood at around 500,000.

In the face of the existing law for the Forex industry in Russia, the majority of Forex investors remain outside of the Russian jurisdiction.

When the bill was filed, the authors noted that one of the reasons for the difference in the client numbers of Russian and offshore brokers is that the current Russian laws lack a provision permitting simpler client identification at Forex dealers. An account at an offshore Forex broker, however, may be opened online, without a visit to the company’s office.

The bill envisaged changes to Russia’s anti-money laundering law. It proposed a simpler procedure for client identification when signing a contract with a Forex dealer. The new rules would have applied to companies that have Forex dealer licenses issued by the Bank of Russia.

In August this year, Russia’s Association of Forex dealers said the number of clients of Russian Forex dealers is set to increase 4-5 times if the proposed legislation for introducing a simplified client identification procedure is approved by Russian lawmakers.

Read this next

Metaverse Gaming NFT

DCentral Miami brings together all of Web3, NFT, DeFi, Metaverse

The world’s biggest Web3 meeting entitled DCENTRAL Miami is set to take place November 28-29, featuring a lineup of some of the biggest and most influential names in the blockchain space.

Digital Assets

Crypto ban expands across UK banks as Starling joins ‎crackdown

UK digital bank Starling has banned ‎all customer payments related to cryptocurrencies, another blow for the crypto traders ‎who recently saw a sizable number of banks deciding not to ‎finance the wobbly asset class.‎

Interviews

Markets Direct at FIA EXPO 2022: Traders know what they want from brokers

The FIA Expo 2022, one of the most prestigious events within the global derivatives trading industry, took place in Chicago on 14 & 15 November.

Interviews

FIA Expo 2022: TNS addresses public cloud limitations with hybrid infrastructure

November is the month of the FIA Expo, one of the largest futures and options conferences in the world, bringing together regulators, exchanges, software vendors, and brokers in one place: the Sheraton Grand Chicago Riverwalk. 

Retail FX

Italy’s regulator blacks out Finance CapitalFX, MFCapitalFX

Italy’s Commissione Nazionale per le Società e la Borsa (CONSOB) has shut down new websites in an ongoing clampdown against firms it accuses of illegally promoting investment products in the country.

Retail FX

Suspected leader of Honk Kong ramp-and-dump scam appears in court

A leader of a sophisticated ramp-and-dump scheme made his first court appearance in a Hong Kong court today, charged with market manipulation and various criminal offences. The case stems from an earlier joint operation of Hong Kong’s financial watchdog, the Securities and Futures Commission (SFC), and the local police. 

Institutional FX

Cboe’s James Arrante discusses growing demand for fixed income, FX algo

We caught up with James Arrante, senior director of FX & US treasuries product and business management at Cboe Global Markets, to uncover emerging trends in the FX and fixed income markets and learn more about the bourse operator’s recent initiatives.

Retail FX

Eurotrader acquires UK broker Petra Asset Management

Eurotrader Group has formally entered into the UK market with the acquisition of FCA-regulated broker, previously named Petra Asset Management Ltd. The new entity operates under the brand name Eurotrade Capital Ltd.

Inside View, Retail FX

The Game of Chess Continues – OPEC, China and the Oil Market

Over the past decade, the US has been complaining about the amount of power which the BRIC group, and specifically China, has on the global economy. BRIC stands for Brazil, Russia, India and China; these were the world’s fastest growing economies. Only in the past 10 months, the US has turned their attention toward OPEC due to the prices of fuel. Nevertheless, China seems to have a strong influence even over the price of crude oil.

<