Russia says it is not just fraudulent brokers to look out for, it can be traders too

While nowadays the FX industry has become relatively accustomed to regulators issuing warnings against fraudulent or unregulated Forex brokers in an effort to protect investors, Russia’s Commission for the regulation of relations on the financial market (KROUFR) has taken the unusual step of warning Forex brokers against fraudulent traders.

In its warning, KROUFR notes that trader scams are not rare occurrences and lists the most popular types of such misconduct, including misuse of bonus funds or abuse of the rules of bonus campaigns, scams related to referrals and auto-referrals within partnership programs, fraud related to positions that have swap-fees calculated on them, payment fraud, including fraud related to account opening and arbitrage using automated trading strategies.

The Commission highlights the last type of fraud as the most popular one. It also says that this sort of fraud costs the most to Forex brokers, while implying great risks for traders too. Not only are arbitrage-robots highly expensive, traders also risk having all funds in their trading accounts blocked.

KROUFR cautions traders to stay away from the use of such illicit methods of making profit in the Forex market. Chances to actually make profit using such means are way smaller than when using totally normal means like technical and fundamental analysis.

KROUFR is a body that embraces several Forex brokers active in Russia and aims mainly at tackling complaints against its members and solving different Forex industry disputes in an impartial manner. The Commission has been active since December 2003.

The full text of the warning can be found by clicking this link.

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