All About NAFD Forex Brokers
It seems everything has become a little complicated in respect of the regulation of Forex brokers in Russia. There are many traders, both new and more experienced still scratching their heads and wondering which way to go. Russia has been the subject of a lot of bad press in recent years with regards to its financial markets and the likelihood of being the victim of a scam. It may be because of this it was decided to streamline the regulation of the Forex industry and the Central Bank of Russia has been working tirelessly on a new Russian Forex law. With effect from December 2016, the new law will become active. It will mean control of the Russian Forex market is put in the hands of a ‘mega-regulator’ the Central Bank of Russia. Any company wishing to provide Forex trading services for Russian citizens will need a special license from the Central Bank. it will also need to be part of a self-regulatory organization. Some of these organizations are still applying for authorization from the Bank. There are a number of self-regulatory organizations seeking authorization and one of these is the NAFD.
What is the NAFD?
NAFD stands for National Association of Forex Dealers, and it is an organization previously known as CRFIN. The rebranding took place following a General Meeting of the Association members. A new Chairman of the Board was announced along with the creation of a Board of Directors. But how did CRFIN come about? CRFIN, or The Center for Regulation in OTC Financial Instruments and Technologies, came about when several independent members of the Russian financial markets came together. It was developed to regulate and supervise financial companies and became very effective in its role. CRFIN was a self-regulatory organization and considered to be a highly reputable agency in respect of regulating financial brokers. There was, however, a problem. While CRFIN was respected in the industry because it worked in the best interests of the market it was still not recognized as a Government-approved agency. Countless requests had been made by the Center’s top officials and financial experts to be included as an approved agency but these fell on deaf ears. This forced CRFIN to rethink its attack and led to the rebranding of the Center to NAFD.
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NAFD regulated brokers and how traders are protected
Along with its rebranding, a new regulatory framework was designed and developed by industry experts. The framework incorporates a number of aspects of modern regulatory standards generally used by leading regulatory bodies. Previous guidelines were modified and the administration was changed. Both of which have allowed NAFD to fall into line with the demands of regulatory guidelines expected by modern Forex traders. Forex brokers in Russia are obliged to follow guidelines issued by the Central Bank of Russia and the Finance Ministry. As well as adopting Government guidelines, NAFD also includes a number of its own to enable investors to enjoy a better trading environment. There are currently very few brokers based in Russia who have been able to obtain licenses, but this may well change over time as the industry becomes more aware and the regulatory procedures become well known. Overseas and international Forex brokers wishing to offer services to Russian traders are required to undergo the regulatory procedure and obtain a license from the Central Bank as well as a self-regulatory organization, such as NAFD. The Government has become very proactive with regards the financial scams which have given Russia a bad name and are clamping down on unregulated, unlicensed and illegal brokerage firms. A deadline has been set for some firms to fall in line and become regulated or run the risk of being closed down. The Government is showing itself to be very concerned with protecting investors, which can only be seen as a good thing for anyone looking for regulated Forex brokers in Russia.
The number of NAFD Forex brokers is steadily increasing
NAFD is starting to receive the recognition it deserves, from all sections of the trading community. The number of NAFD regulated brokers is steadily increasing as the association gains its distinction. A number of well-known international Forex brokers have already decided to set up a base of operations in Russia, and obtain licenses from the NAFD and the Central Bank of Russia. And some of the well-known brokers that originate in Russia are also gaining in popularity in the area. NAFD and NAFD licensed brokers may not be considered as reliable as those with FCA or NFA approval but there is still a reasonable level of reassurance. It is still very much early days for NAFD and its involvement in Forex regulation, and the regulatory situation in Russia is still under discussion, but it’s looking good for the future reputation of the association. Of course, there is still a way to go and many experienced traders consider the association much more able to improve safety aspects of market trading.
NAFD Forex brokers and the future for retail traders
The Forex trading sector is all set for some positive change. It seems that all the associated industry sections are hoping to make market trading far safer and better supervised. With the number of regulated brokers set to rise it will mean Russian traders will soon have a much better choice. There is a wealth of information available for those who might be interested and we’ll be keeping you informed as best we can. You may find yourself looking at the possibility of an unregulated broker, as there are always going to be a few that slip through the net. The best advice is to steer clear of this type of broker and to ensure the authenticity of any claiming to be regulated. It is a very simple check to make, by visiting the regulator’s website. There is often a simple search option, a list of unapproved brokers and as a last resort contact the regulator directly.