Binary options brokers receive different licenses to conduct brokerage activities. Russia is no exception. Control of financial activities, companies should take place, under the strict supervision of the state.When choosing a broker, the trader faces a difficult task.
How do you tell if your chosen binary trading broker is decent and honest, or if it’s a scammer? Which regulation do brokers prefer, and which ones do traders prefer? Is this a real company or a clone of it? And which brokers should be preferred – with a foreign or Russian license? We read about all this and much more here.
Is there a good binary options broker?
Trading binary options is always a risk. The risk of losing some of your savings or even everything you have invested. And before you start trading, you need to clearly understand this.
Binary options trading is becoming an increasingly popular and desirable method of making money. This is often due to the most seemingly naïve prejudices, they say, it is enough to press a button – and millions will fall on you. And with elementary ignorance of the market and its laws.
THE ANSWER IS UNEQUIVOCAL – THERE IS. THE PROBLEM IS THAT THE QUALITY OF A BROKER DOES NOT ALWAYS DEPEND ON THE AVAILABILITY OF A LICENSE. SOME BROKERS WITH A LICENSE ISSUED IN RUSSIA ARE THE SAME SCAMMERS AS THOSE WHO OPERATE WITHOUT A LICENSE AT ALL.
PAY ATTENTION TO BROKERS IN THE EVEN LIST AND THE SECTION OF COMPLAINTS AGAINST BROKERS. YOU CAN FIND THAT SOME OF THEM ARE LICENSED BY THE CRFR
For scammers, such would-be traders are a reliable and fast way to make money. So fly-by-night companies are flourishing, clone companies, which, as it sometimes seems, are even more than good binary options brokers.
The main task of a trader, if he does not want to lose everything at the very beginning, is to choose the right broker. How to do it?
Which binary options brokers are reliable?
UTRADER IS AN HONEST BROKER. FAST WITHDRAWAL AND GOOD SUPPORT FOR BOTH BEGINNERS AND PROFESSIONALS
Of course, those that are regulated, that have a license. However, this is not always the case. Not all licenses are given by the state, and not all protect the trader from illegal actions on the part of the broker.
As the reviews of traders and the complaint show, a license issued in Russia is not a guarantee of quality. At the same time, European regulators have more opportunities to put pressure on the broker and resolve issues lagging behind the interests of the trader.
Is a broker’s license a panacea for a trader?
It is generally believed that the presence of a license from a broker is a sufficient guarantee that everything will be fine and trading will be honest. Is this true?
Let’s find out.
There are several organizations that deal with licensing brokers, mainly Forex, but some of them also work with binary options brokers. In fact, there are several organizations that issue licenses to brokers:
- NAFD (National Association of Forex Dealers);
- KROUFR (Commission, regulator of relations between financial market participants in Russia);
- FMRC (regulator of relations between parties in the market);
- FCA (Financial Conduct Authority) is a non-governmental regulatory authority in the UK;
- CySec (Cypriot regulator);
- Lotteries and Gaming Authority in Malta (regulator for gambling establishments and the like in Malta);
Each regulator has its own requirements, but they all check both the financial and technical side of the broker’s activities. So the trader can be sure that the broker, if he has already been issued a license, has enough money and an adequate platform that allows you to trade without delays and delays. Please note that in Russia, there are non-commercial and commercial organizations that conduct control. Therefore, they are not always honest or can affect the actions of the broker.
As for Russian traders, it is not always better for them to work with brokers who have a license issued by Russian regulators. It’s not even that foreign regulators may not be reliable enough. In the Russian Federation, binary options are a gray area, without specific understandable laws.
The most important point of regulation is who will resolve the conflict between the broker and the trader. There is a technical problem and a problem of legality.
In fact, the problem is more technical. Imagine that you have a misunderstanding, say, with a broker registered in Cyprus and regulated there. Do you have the opportunity to file a lawsuit or complaint with the regulator in Cyprus? And how long will your complaint be considered? Chances are, you’ll spend more than you win. Many brokers licensed in the West do not provide service to people from Russia, so even if you opened an account and made a deposit, it is not a fact that you can trade with this broker, as well as not the fact that the regulator will defend your rights.
By the way, if you know English, you can file a complaint through the regulator’s website. It is important to clearly enter the name of the company that operates this broker.
MANY BROKERS WITH RUSSIAN REGULATION OFFER TO START TRADING WITH A DEPOSIT OF ONLY $ 10. IT IS ALMOST IMPOSSIBLE TO MAKE MONEY WITH SUCH AN AMOUNT. THE MINIMUM LOT IS $100,000. THEREFORE, THESE BROKERS ARE CASHING IN ON TRADERS’ LOST MONEY.
Binary options brokers with a Russian license may be the best choice for traders. But not always. In our rating, several brokers with a license from KROUFR and CROFM have been moved to the “BLACK LIST” due to numerous complaints from traders. About the withdrawal of funds, the service and the trade itself.
The technical part may be the same as that of Western companies, but boorish and non-professional service affect the loss of deposits by traders.
Filing a complaint remains only a complaint, as the terms and conditions of such brokers protect them from traders. It is a pity that few people read these conditions, since it is immediately clear that you are not protected by anyone, and you yourself will be to blame.
CHOOSE ONLY BROKERS FROM THE RATING
Organizations issuing licenses to brokers in Russia
It is important to know all the organizations in Russia that issue licenses. Understanding who and how they protect you from will help you with your issues. After all, we are not interested in regulation until the broker deceives us or influences the result of our trades.
In our list of not recommended brokers, there are those that were at the top of the tables, but the complaints received against these brokers were not resolved because the regulator could not influence them. The promises turned out to be false, because we traders cannot prove that we were deceived and promised unrealizable successes or gave false signals.
So, what licenses or certificates can be issued to a broker in Russia.
KROUFR
The forex and binary options market is regulated locally, and exists globally, so today KROUFR provides mediation mechanisms for reaching compromises in case of disputes. This means that KROUFR DOES NOT have full influence on brokers.
KROUFR is a Russian regulator whose tasks include:
- coordination of financial market participants;
- establishment and disposal of a compensation fund;
- development of standards and rules for the regulation of financial transactions in international financial markets;
- quality control of the work of financial market participants.
And KROUFR also carries out certification of financial market participants. However, the regulator works with banks, investment companies, Forex brokers, binary options brokers are not on its list.
NAFD (CRFIN)
The National Association of Forex Dealers (NAFD) IS NOT A GOVERNMENT AGENCY, CONTROLS ONLY THE MEMBERS OF THE ORGANIZATION, AND DOES NOT HAVE A LEGAL BASIS FOR RESOLVING ISSUES
NAFD appeared when it turned out that KROUFR could not cover the full range of tasks assigned to the regulator. At first it was SRO CRFIN, or the Center for Regulation of Over-the-Counter Financial Instruments and Technologies. And then it was renamed NAFD.
This regulator also works with Forex brokers.
CROFR
FMRC is an independent organization, which is why there are no brokers among its founders who could influence the decision regarding the certification of a company, as well as any other decisions.
The decisions taken by the FMRC are binding on companies that have already received certificates of conformity, and should also be taken into account by those organizations that plan to undergo the certification procedure.
THIS MEANS THAT IF THERE IS NO CERTIFICATE, IT IS NOT NECESSARY TO FOLLOW THE INSTRUCTIONS, MOREOVER, THE REGULATION IS NOT CONTROLLED BY THE LAW OF THE RUSSIAN FEDERATION
The Center for Regulation of Relations in Stock Markets is another Russian regulator. And yes, it works with Forex brokers and binary options brokers. And the trader can be sure that if he works with a broker that has passed the certification of the FMRC, then his money is safe. Even if the broker goes bankrupt, the trader will still receive his money from the compensation fund.
In order to obtain a FMRC certificate, a broker must meet very high standards and:
- work in this field for at least two years;
- have more than 5000 customers;
- have more than 2500 active client accounts;
- availability of representative offices in other countries;
- be adjustable,
Moreover, the presence of a certificate does not mean that the broker has received it once and after that he can do what he wants. Not at all. The certificate is issued for a year, and then the broker must again go through the entire certification procedure.
Upon receipt of complaints about the illegal actions of the broker, the FMRC may revoke the license that has already been issued.
Not many can even think about applying for certification. So far, only 48 companies have been able to obtain a certificate from the FMRC. So, if you want to be sure that your broker is honest, and that he meets the highest requirements, see if he is on the list of certified brokers. The list can be found on the regulator’s website.
Clone companies – steal the brand from good binary options brokers.
However, there are pitfalls here. Certified brokers are so popular that scammers can operate under their name. Often, scammers even develop websites, practically copying them from the site of a real broker.
Before making a deposit with a broker, check reviews and complaints
Is it possible to distinguish a decent broker from his clone?
Yes. You can distinguish an honest broker from a clone company. Moreover, you need to know how to do it.
Five signs that you have a clone company in front of you.
- The broker refuses to grant a license. This can only mean one thing – the broker does not have a license. Work with such a company? We do not recommend it.
- The type of activity specified in the license differs from the provision of intermediary services in financial markets.
- According to the contract, the company carries out its activities without imposing obligations on the company.
- The license number provided by the broker does not match the number indicated in the regulator’s database.
- The license has expired.
If you notice at least one of the above points, stay away from such a company.
REMEMBER, NOT ALL BROKERS WHO ARE NOT CLONES, AND EVEN HAVE A LICENSE FROM RUSSIAN REGULATORS, ARE HONEST. ALWAYS CHECK THE BLACKLIST OF BROKERS. WE BELIEVE THAT SCAM BROKERS OR A BROKER WHO DOES NOT PROVIDE HONEST SERVICE TO TRADERS ARE SCAMMERS.
CHECK OUT THE BINARY OPTIONS SCAMMERS
Broker with which regulation is better than European or Russian
There is no definitive answer here. Binary options brokers with European licenses behave more honestly with traders, as they are controlled by law and the state. Companies are constantly inspected and if they do not comply, they pay high fines measured in millions of dollars. Up to the point that the owners of the broker can go to jail for a long time.
While licenses in Russia cannot affect the broker. Take away the license at most, but they can still continue to work and continue to deceive people.
The latest example was the closure of one of the largest binary options brokers BANQUE DE BINERY this month (January 2017). Due to non-compliance with the rules of conduct in the financial market.
But we have not yet seen the Russian binary broker, which was closed for poor quality work.
We believe that it is best to read real reviews of traders, and understand what questions or problems may arise with the broker.
Certified options brokers – how to get a license in Russia
As an example, let’s consider the rules for obtaining a certificate from the FMRC. Please note that for the broker it is just a marketing tool that improves the credibility of the broker.
For a trader, this is protection. However, the FMRC does not guarantee the withdrawal of funds and compensation.
IT IS NOT DIFFICULT TO GET A CERTIFICATE. THEREFORE, MANY BROKERS ARE LICENSED BY THE CRFR.
Rules for obtaining a certificate of the FMRC
To obtain a certificate of conformity of a financial institution, it is necessary:
- send an application in the prescribed form for certification of the services provided;
- submit the necessary documents: license, certificates, available certificates, the availability of which is mandatory in accordance with the established requirements, as well as documents that regulate the interaction of the applicant company and customers;
- conclude a contract for certification of services;
- pay for certification work.
Benefits for traders
- Guaranteeing partners and customers to conclude an agreement with a reliable and efficient company that provides high-quality services.
- Protection of the trader’s rights and resolution of all disputes that arise in the process of work between the client and a financial institution certified by the FMRC.
- Availability of a compensation fund to compensate for losses incurred by clients of companies certified by the FMRC.
- Guaranteeing the payment of funds placed on deposits to traders, subject to confirmation of the availability of such, if a brokerage company with a certificate of compliance with the FMRC is declared bankrupt.
If it is impossible to establish contact with the company in order to make legal claims for the return of funds to customers or in the event of termination of the organization’s activities as a result of force majeure or other circumstances, the FMRC guarantees the payment of funds, subject to confirmation of the availability of such funds in the accounts of this company.
For claims relating to lost profits and compensation for moral (non-material) damage, the FMRC is not financially liable and does not guarantee any compensation or payment.
Benefits for brokers
The certificate of conformity of the FMRC for a financial institution is:
- guarantor of stability and high quality of services provided;
- status, image and respectability of the company;
- increase in the number of potential customers;
- an excellent PR occasion and an additional opportunity to express yourself;
- confirmation of the competence and professionalism of the company;
- expansion of positive public awareness of the company among clients and in the professional community;
- documentary evidence of the company’s competitiveness.
Results:
In conclusion, we can say that the presence of a Russian license is not a guarantee of quality. Perhaps the main advantage is that brokers are designed for Russian-speaking traders. It is easier for traders living in the CIS countries and Russia to trade with brokers certified by the Russian regulator.
If there are controversial issues, you can contact the regulator in plain language.
However, opening an account with a broker with European regulation may be better for the trader. But there is one drawback, communication with regulators in English.
By submitting the application correctly, you can know for sure that your application is being processed and you will be provided with a solution.
Therefore, binary options brokers in Europe are afraid of the regulator, while in Russia not so much.
We believe that the main thing before choosing a broker is to read reviews and make the right decision.
WHEN CONCLUDING, USE THE FOLLOWING SYSTEM TO SELECT A BROKER:
remember, the presence of Russian licenses from a broker is not a guarantee of quality
LICENSE > REVIEWS >TRADING CONDITIONS
TRADE ONLY WITH HONEST BROKERS
