Are you keen to find the best FMRRC regulated brokers in Russia? Good news – we have exactly what you need. Read on to find out more about who the FMRRC are and what they do, plus tips on finding the best brokers regulated by the FMRRC.
Anyone considering trading in Russia should be prepared for a complicated and rocky ride. The current regulation situation is still a little hazy. There are a number of ‘so-called’ regulatory bodies which makes it very confusing for those of you looking for the right one.
There has been a lot of discussion recently with regards regulating the Russian forex industry and as of 2016, the only official regulator is the Central Bank of Russia. However, there are a number of other organizations who seem to consider themselves responsible for trading and one of these is FMRRC. Want to find out more? Keep reading to learn about the best FMRRC regulated brokers.
Is it safe to use a FMRRC regulated broker? And which is the best one?
There is a flicker of hope for any traders choosing FMRRC brokers because they are subjected to a number of restrictions. Which will greatly reduce the risk of large-scale financial scams. The issuing of a certificate requires the Center to review the applicant for authenticity before the certificate is awarded. Certified brokers found to be participating in financial irregularities or consumer abuse are at risk of having their certification removed, which is reassuring for traders.
While it is safer to use a FMRRC regulated broker than an unlicensed one, it can be tricky to pinpoint the best one. This is mainly due to the fact that the FMRRC has little authority compared to brokers in Germany, the UK and other countries.
What is FMRRC?
FMRRC stands for the Financial Market Relations Regulation Center. It is an independent self-regulatory agency which was created to provide a level of regulation for derivative dealers and brokers. It has no connection with the Central Bank of Russia, the official regulatory body in Russia. And it has very few legal powers when it comes to regulating FMRRC brokers. However, with the regulation of Russian forex brokers in such disarray, it is a sensible option to look for the best FMRRC regulated brokers.
What can the FMRRC do?
The FMRRC is able to certify financial organizations. The certification process involves a detailed inspection, following which the financial organization will be issued a certificate. All the best FMRRC regulators brokers comply with the Center’s conditions, which are designed to provide fair and high-quality services for consumers.
The FMRRC’s main responsibilities include:
- Evaluating financial organizations and their activities following certification
- Co-ordinating participants activities in respect of financial markets
- Minimizing risk for market participants
- Developing evaluation systems for financial organizations
- Establishing a compensation fund for clients of FMRRC certified organizations
The ultimate aim of the FMRRC is to provide traders with the best possible security of their investment.
What is a FMRRC regulated broker? Understanding the history of FMRRC
The FMRRC was established in 2011 by a Russian broker who was looking for a way to certify brokers without government involvement. It didn’t take long for the Center to grow into an organization which was able to sustain itself. It became a popular choice for forex brokers in Russia who wanted to receive a level of regulatory status. Unfortunately, Russia doesn’t have a particularly good track record when it comes to the market and there have been a number of financial scams and fraudulent practices. So, the establishment of the FMRRC was certainly seen as an exciting prospect by Russian brokers looking for more legitimacy.
Central Bank of Russia
There have also been numerous reports of the lack of continuity within Russian financial services. As mentioned, the Central Bank of Russia has now taken over the regulation of the industry. That means that a broker wishing to set up business in Russia, or provide services for Russian citizens, now has to obtain a license from the bank. However, the situation is still very much in a state of flux, and there are very few licensed and regulated brokers available.
At the time of its founding, the FMRRC and its activities were seen as a revolutionary concept and was originally set up to offer some level of security against irregularities and financial scams. In light of the new legislation, which puts financial regulation firmly in the hands of the Central Bank, the FMRRC appears to be taking on the role of a certifying agency rather than a fully-fledged regulatory body.
Licensing agency
FMRRC has received very little recognition from the government or been given any real authority, so it is restricted in how much control it is able to have over certified firms. It does, however, act as a licensing agency which works with its members to streamline the process of regulation. It also brings together like-minded brokers and presents them under one roof. As an agency, it works well for licensing procedures and regularly issues guidelines for those top FMRRC regulated brokers wishing to renew their license.
For traders, it is good to know the guidelines lean towards reducing investor risk. Nevertheless, it’s disappointing that the FMRRC has little clout or interest in investigating customer complaints. It does have a compensation plan and complaint resolution process, should there be any broker irregularities. But the Center’s lack of authoritative powers means it cannot impose penalties or sanctions against FMRRC licensed brokers.
How can I complain to the FMRCC?
Should you need to make a complaint concerning an FMRRC regulated broker, you are advised to contact the Center directly. The organization promises to investigate impartially if the broker is thought to be deviating from the guidelines. It is also possible to receive compensation in the event of a broker declaring bankruptcy. Try to avoid putting all your eggs in one basket. Instead, split your investment between a selection of regulated brokers. This will help reduce your risk.
Checking for FMRCC regulation
When you’re looking at a broker’s website, they’ll usually want to shout about their licenses – so they’re not very hard to find. Look at the footer of the page or possibly in the ‘About’ section and you’ll probably find the information you need, if you’re looking at any of the best FMRCC regulated brokers.
However, how do you know the data provided is accurate? Luckily, there is a section of the FMRRC website which lists companies which have been found to be falsifying certificates. There’s also an online contact option to request additional information.
Frequently Asked Questions (FAQs)
The FMRRC (Financial Market Relations Regulation Center) is a non-commercial organization, which was created to regulate the quality of brokers, dealing centers, cryptocurrency exchange markets, and cryptocurrency mining services. It was created independently of the Russian government so that brokers could provide some reassurance to traders, in a time when forex trading was something of a grey area in the country. There are now 52 brokers regulated by FMRRC.
Some FMRRC certified brokers may well be safe, but we do not recommend that you trust a broker entirely on the fact that it has a certificate from the FMRRC. As the FMRRC is an independent body, it does not have any legislative powers to protect you against misconduct. If a broker fails to meet the FMRRC requirements, its certificate is simply revoked. To ensure you are trading with safe and trustworthy brokers, we recommend only registering with those that are licensed by authorities with legal powers.
The FMRRC is legit in that it exists and does aim to impose rules and requirements on those brokers and cryptocurrency exchanges which display a FMRRC certificate. That said, the FMRRC is not considered to be a top-tier authority. If you are looking for a regulated Russian broker, we would recommend choosing to trade with an offshore broker instead.
As the FMRRC is a non-governmental body, it does not have the power to enforce any legislation or regulation. As such, brokers are simply certified by the FMRRC. To check whether a broker has a FMRRC certificate, you can either check the broker’s website or contact the FMRRC directly.
The FMRRC was formed in 2011, before Russia had a centralized regulatory body. Since then, however, the Central Bank of Russia has been given regulatory powers, leaving the FMRRC as more of a certification agency. Once this became the case, the FMRRC began certifying international brokers too; IFMRRC stands for International Financial Market Relations Regulation Center.
