Bank of Russia Plans to Regulate Binary Options
Binary options trading remains, as of late, unregulated in Russia. Fraudulent binary options brokers and firms continually target Russian customers, as it remains a heavily profitable way to scam consumers out of hard-earned income.
To date, the Bank of Russia has yet to take any known steps to address this issue, however, the head of the bank’s Department for Countering Malpractice – Valery Lyakh – has made statements suggesting that that bank may soon put measures in place to reign in binary options fraudsters and protect traders.
Mr. Lyakh, in an interview with Financial One magazine, related that the Bank of Russia has been receiving a considerable amount of probing inquiries, from police officers all over the Russian Federation, about the unregulated binary options firms.
Russia’s Central Bank, Mr. Lyakh confessed, has still not closed down any of binary options firms operating on the internet. In large part, this is due to the fact that the financial regulator’s hands are tied. The websites in question offer binary options trading services, but, the regulator does not have any type of power or position of authority when it comes to binary options.
In theory, binary options are similar to financial derivatives, but when put into practice, they operate more like gambling bets.
Lyakh, in his interview, illuminated the primary concern regarding binary options. He said that, in theory, binary options are similar to financial derivatives, but when put into practice, they operate more like gambling bets. It is for this reason that the Bank of Russia is in the midst of establishing an outline for changes to legislation regarding binary options trading.
The paperwork portion of this outline is, according to Lyakh, is scheduled to drop sometime in the fall. The Central Bank is also putting together an informative pamphlet about binary options trading, warning Russian residents of the tremendous risks attached to such investments.
Mr. Lyakh also indicated that international actions against semi-financial operations like binary options trading will, in all likelihood, be addressed and established by the International Organizations of Securities Commissions (IOSCO). To this end, Lyakh made note of the growing number of companies operating fraudulently and illegally around the world that have offered their services to clients in Russia.
The Russian Forbes edition, in April of this year, released estimates indicating that Russian is responsible for approximately 29% of the traffic on four of the largest binary options websites. Data uncovered by Forbes reveals that these four sites were visited more than 50 million times in April alone. Based on the estimated 29%, Russian residents account for 14.5 million of those visits.
Jacob has been an author for Binary Options Expert since our launch in 2012. He has over forty years’ experience in the financial sector and has held a variety of positions within financial services corporations and venture capitalist organisations. Learn more.