Pseudo Regulation: Finpotrebsouz

As Contracts for Difference are unregulated derivatives in Russia a number of Forex companies operating in Russia have taken lengths to make it appear that they are properly regulated. I have previously talked about the RAFMM which makes out that is a proper regulatory body, however in fact it is nothing but a trade association created for the convenience of its own members. All of which are owned by the same company based in the Seychelles. 

Some of the companies have now made a new attempt at appearing to be an outfit with proper oversight and regulation by becoming partners of a consumers right watchdog. The particular consumer rights group is registered a Non-Governmental Civil Rights Organisation called  защита потребителей финпотребсоюз (or in English ‘Financial Consumer Protection Union). This is simply a consumer rights watchdog which is registered with the relevant authorities in Moscow. The site claims that the organisation will look after the consumer rights when it comes to banking and other forms financial transactions. While this particular consumer rights group does have a number of notable figures on its board of members and is infact mentioned within Russian law, it does not amount to any form of regulation.

Rather its goal is to attempt to help individuals with getting the right legal advice and with the goal of protecting consumers. As well as helping the consumer shape future legislation and increased public awareness about different financial issues. It doesn’t mean that the companies which claim partnership with Finpotrebsouz have proper governmental regulation, in fact it is made very clear that Finpotrebsouz is a non governmental body. Meaning that Finpotrebsouz can infact not issue fines or undertake legal sanctions against those who partner with the organisation like a traditional financial regulator would be able to. 

Does this mean people should place more trust in Forex organisations operating out of Russia that claim Finpotrebsouz partnership? I would say no, it all it means is that the particular organisations are undertaking steps to appear more legitimate and official while still remaining unregulated.

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