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Author Topic: Russian brokers - Is your money safe?  (Read 4863 times)

Offline 999cjb

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Russian brokers - Is your money safe?
« on: March 16, 2014, 11:11:08 AM »
This is not a political comment nor should it be. But with the Crimea "election" today, troops massing on Ukraine's border and countries on Russia's borders increasingly worried, how safe is your money with a Russian broker?

Some Russian brokers are:-

Alpari-Forex
Instaforex
Liteforex (SIG)
TusarFX

A number of brokers have offices in Russia such as:-

Tradefort

I have deposits with most of the above and have no intention of bailing out. But any of you who have Russian-based deposits you cannot afford to lose should consider your situation carefully.

If the current political state escalates into armed conflict or worse, do you think you will still be able to extract your USD or Euro deposits on demand?

Offline forexfish

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Re: Russian brokers - Is your money safe?
« Reply #1 on: March 16, 2014, 11:23:27 AM »
This is not a political comment nor should it be. But with the Crimea "election" today, troops massing on Ukraine's border and countries on Russia's borders increasingly worried, how safe is your money with a Russian broker?

Some Russian brokers are:-

Alpari-Forex
Instaforex
Liteforex (SIG)
TusarFX

A number of brokers have offices in Russia such as:-

Tradefort

I have deposits with most of the above and have no intention of bailing out. But any of you who have Russian-based deposits you cannot afford to lose should consider your situation carefully.

If the current political state escalates into armed conflict or worse, do you think you will still be able to extract your USD or Euro deposits on demand?

I think overall Russian brokers carry higher than a normal risk and these days due to ongoing politics risk have been increased a bit further.

Best is to avoid it if possible, otherwise do no deposit all the funds in one broker / jurisdiction.

Also check their withdrawals systems to ensure withdrawals are honored without any delays, etc.


Offline RahmanSL

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Re: Russian brokers - Is your money safe?
« Reply #2 on: March 17, 2014, 05:45:19 AM »
Personally, even in the best of times, I would not want a broker registered or regulated in Russia.

Offline geektrader

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Re: Russian brokers - Is your money safe?
« Reply #3 on: March 17, 2014, 07:18:35 AM »
I am sorry, but Russia is a no go for me. Its nothing against the people that live there really, its the political dictatorship (Putin) that they have there who does whatever he wants. You see, even with all protests and pressure coming in international against Russia, they dont give a damn about that, they just do it. If Russia one day decides to get all your money from the Forex brokers there to pump up their state finances, theyll simply do it - its actually a very small problem for them if you see what they did with the Crimea and how easy it actually was for them.

In any case, I dont have any money with any Russian broker. There are enough great brokers out there that are in stable and fair countries and are regulated + give better conditions than any Russian broker Id have ever seen (apart from that they are mostly market makers that play against you anyway). And apart from that, I would not support Russia by "lending" them any money, not even via Forex broker account.

Offline Bugimen

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Re: Russian brokers - Is your money safe?
« Reply #4 on: March 17, 2014, 09:06:27 AM »

You probably forgot about Cyprus? Putin builds his empire , and he is not stupid enough to kill the goose laying the golden eggs ! About Crimea will say this: the middle of XVII century - population census peninsula conducted the Crimean khan , in the Crimea lived then about 1.12 million people. , including 180 thousand Tatars ( Turks) and approximately 920 thousand Orthodox Christians , mainly immigrants from the Kievan Rus' ( Russian ) . Do not meddle in politics is a dirty business ! Make money , and that the United States could announce default! Putin talks with Iran and Venezuela will sell oil only for gold ! And do not forget Russia unveiled its brand " Gold ruble " !
Many people do not pay attention to it!

Offline Managed-Forex.com

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Re: Russian brokers - Is your money safe?
« Reply #5 on: March 18, 2014, 06:18:26 PM »
I personally trade at Alpari http://alpari-forex.com/. No problems.
http://goo.gl/GAcSv1 - Professional Investing - Managed-Forex.com

Offline jwatts7701

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Re: Russian brokers - Is your money safe?
« Reply #6 on: March 24, 2014, 03:01:04 PM »
I have been wondering this as well especially with the rest of the world in talks of boycotting russia further.

Offline reddevil

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Re: Russian brokers - Is your money safe?
« Reply #7 on: March 26, 2014, 10:27:41 PM »
sanctions comes in several steps. The first is just restricting travel of certain individuals followed by suspending card payments. The more serious sanctions comes when the foreign assets are frozen. when a russian bank needs to send USD to bank in Japan, the russian bank has money sitting with a US bank(intermediary bank e.g. bank of America). The US bank then sends to the intermediary bank of the japanese bank within USA(e.g. Bank of New York). So freezing the assets means that the funds in BOA is no longer accessible, which means foreign trade is not feasible.

So if your russian broker's funds is with a russian bank, then this will likely to happen. Paying the staff with ruble is still done within russia but paying traders overseas will have issue.

I always recommend opening account with brokers in a jurisdiction where the main bank account is also within the same jurisdiction. e.g. ASIC jurisdiction and bank account in Australia. Cyprus Jurisdiction and bank in cyprus.

Most countries insist that a company can only be setup if the company secretary is a resident. It places no restriction on bank accounts. But if you complain to FOS (Financial Ombudsman services) in australia, ist finding is binding and if company refuses to comply, FOS will report to ASIC who could seize assets of the company. but if bank is outside of australia, what is there to seize?

To setup a company in NZ, you do not need a resident secretary or director! So that is why you have lots of company setting up in NZ. FMA requires now that client details be kept in NZ but the main operations can be overseas.
NZ is one of top countries to do business with, since it is little red tapes.

To get around the residency requirements in some jurisdiction, you could pay for a nominee (i.e. someone local who will act as your company secretary). But to be safe, this secretary will insist that your company do not carry out business with customers within that country, otherwise the company secretary could be fined or jailed arising from complaints from locals. You may have noticed that some brokers setup in jurisdiction XYZ but DO NOT allow resident of that country to be customers. You may have wondered why! Now you know.

Anyway coming back to the sanctions, if broker has bank account in russia for operating expenses and for hedging but funds for clients in another country's bank. If funds for russian banks are frozen, it will be tempting to use clients funds for operating expenses to "tie things overs" until the sanctions are lifted even if these brokers are registered in a non-russian jurisdiction.


This is my 2 cents of opinion.

Offline ultracat

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Re: Russian brokers - Is your money safe?
« Reply #8 on: March 31, 2014, 03:32:34 AM »
I did business with tradefort and instaforex.  Not right now, no way.  It's just good ol' fashioned risk management.  With so many options for brokers worldwide, why on earth would anyone deal with a Russian broker right now?

Offline fxview

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Re: Russian brokers - Is your money safe?
« Reply #9 on: April 05, 2014, 04:49:50 PM »
I think a lot of the responses in this thread are slight over reactions, the majority of Russian brokerages are Incorporated Offshore, not in Russia. Alpari RU is aimed at those who are residents of Russia and other CIS states, but the company is actually incorporated in Saint Vincent. Sanctions against Russian companies shouldn't affect these  brokerages as from a legal standpoint they are technically not Russian at all. Personally, I would say that your funds are no more at risk than they were before the start of Ukrainian crisis and that the US won't be able to crack down on Russian companies based in offshore secrecy jurisdictions.

Offline nordx

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Re: Russian brokers - Is your money safe?
« Reply #10 on: April 05, 2014, 05:33:48 PM »
While there is demand there will be supply, no one needs to close the brokers in Russia, even though the present political situation!

Offline reddevil

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Re: Russian brokers - Is your money safe?
« Reply #11 on: May 15, 2014, 12:32:39 AM »
Looks like a financial sanctions is being planned:
http://www.ft.com/cms/s/0/d6ded902-d9be-11e3-920f-00144feabdc0.html#axzz31jczwXoT

Like I mention is earlier post, the US can go alone by restricting access to US transactions since all US payments are transacted in US. But with SWIFT, basically all international payments are frozen if you don;t have access to this. But europe needs russian gas.

So if you are a russian broker and your company's account is in Russia which you need to pay LP etc, your client money is with barclays in uk (say). That means you cannot use your company account to pay the LP, so it will be tempting to use client money for this!!  Most countries only allowed locally registered company to open bank accounts in that country.

Like all rules, there are ways around this!

As a non US person, I can tell that the current US administration is weak(so can Putin), so no drastic measures are expected.

Offline geektrader

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Re: Russian brokers - Is your money safe?
« Reply #12 on: May 17, 2014, 10:08:51 PM »
I really dont see the point of why to use a Russian Broker at all. Even if they are honest (which most of them are NOT), there is no regulation, no nothing you can complain about just in case they decide to NOT give you your money back or to play with your trades. You are completely exposed to their good will and they can freely do whatever they want, including to play with your trades and not allowing a withdrawal or simply taking your cash. Your hands are completely bound in case they decide to do so, and alone that fact will not make me use ANY Russian broker. There are enough well regulated UK / Australian brokers out there that are FSA / ASIC regulated and where you have real good chances that if they play dirty tricks and you complain to the regulators, that they will do something to help you. With Russian you have no chance at all to ever get help in case they play dirty tricks. Apart from that I dont know of ONE Russian broker that has fair conditions that another (regulated) broker wont be able to compete with. All the really great brokers with fair conditions and low spreads are outside of Russia (like Global Prime). So why even risk it at all?
« Last Edit: May 17, 2014, 10:10:36 PM by geektrader »

Offline Purri

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Re: Russian brokers - Is your money safe?
« Reply #13 on: May 18, 2014, 12:21:03 AM »
Present political tensions aside, there is little legal certainty in russia, its questionable if you can call this a rule of law at all. In a russian court it depends on who you are and who you are up against. This is certainly not an environment for an outsider.

Offline geektrader

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Re: Russian brokers - Is your money safe?
« Reply #14 on: May 21, 2014, 06:58:29 AM »
Thats the point, and really, there are no Russian brokers offering any better conditions than any of the serious regulated brokers out there. All these Russian brokers offering you 100% deposit bonus and 1:1000 leverage are market makers and that in a country that is like the wild west (as you see with Crimea) - they can and will do everything they want after giving you your 100% deposit bonus.... once you make serious profit (if even possible with there usually huge spreads) you will soon lose all your money through super slippage, slow execution, requotes and all these little dirty market maker tricks. And no one will be there to help you, no regulator (cause there is none) and no court (because they dont really care and are corrupt). Go somewhere serious, there is no need to risk your hard earned money more than needed.
« Last Edit: May 21, 2014, 07:00:12 AM by geektrader »

 

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