Russian FX dealers with annulled licenses due to file reports with c-bank on Feb 1st

Maria Nikolova

The reports are poised to explain how the companies, including Alpari Forex, Forex Club and TeleTrade, have satisfied the obligations regarding their clients.

The five companies that had their Forex dealer licenses taken away in a recent regulatory sweeping action in Russia are set to report on how they satisfied their obligations regarding their clients by the end of this week.

The Central Bank of Russia, quoted by Russian information agency TASS, has commented that the five Forex companies in question – Alpari Forex, Forex Club, TeleTrade, TrustForex and Fix Trade, are due to submit their reports about the status of fulfillment of their obligations to clients on February 1, 2019. The regulator said that, as of January 21, 2019, the five brokerages informed it that they had satisfied the bulk of their obligations to their clients. The reports to be filed on February 1st are set to provide information as of January 27, 2019. The latter is the deadline for the five companies to return all funds to their clients.

On Monday, Alpari Forex issued a press release saying that, in line with the decision of the Central Bank, it stopped working on January 27, 2019. Alpari Forex noted that it had informed its clients in a timely manner about them having to close their positions and that, on January 18, 2019, it ceased trading. This change has affected all real and demo accounts.

As a result, Alpari Forex has ended providing its services to 1,073 clients and has returned them all funds due.

Forex Club has not yet provided any detailed information on its website. However, there is a brief notice warning that the company had stopped providing services as a Forex dealer effective January 27, 2019.

In its official announcements published in December 2018, the Central Bank explains that the licenses of five companies – Forex Club, Alpari Forex, Trustforex, Fix Trade, and TeleTrade Group, are taken away due to violations of the Russian law by the brokers.

  • Regarding Forex Club, the regulator explains that the broker has violated the Russian securities law numerous times. The violations include (inter alia): noncompliance with the instructions issued by the Central Bank; violations of the requirements for internal accounting; providing false data to the Central Bank.
  • Regarding TrustForex, the Central Bank explains that the broker failed to comply with the Central Bank instructions, and provided false information to the regulator. The company also gave false information on its website and had flaws in its risk management system.
  • TeleTrade, inter alia, violated the requirements for calculating its own funds (capital), and provided the regulator with false data. The company also provided false information on its website.
  • Alpari Forex also failed to follow the instructions of the Central Bank of Russia. The company committed violations in the way it handled its internal accounting. The company also provided false accounting data and committed violations when handling risks.
  • Fix Trade did not provide information on its website as required. It also failed to follow the instructions issued by the Central Bank. The company also violated the Forex dealer license requirements and did not appropriately handle risks.

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