Forex Regulators

Forex, Binary options Regulators


Understanding the role of financial regulators in Forex

The forex markets, as we know are unregulated markets, traded mostly over-the-counter (OTC) unlike the stocks, which are traded via an exchange. Despite this fact, the brokerages that offer or facilitate the trading services related for Forex, including CFD’s do come under the purview of the financial regulators. Commonly referred to as Forex Regulators these institutions are actually authorized to oversee the financial markets activity.

Almost every developed economy has a dedicated team or institution, whose sole purpose is to ensure fairness and transparency in the field of finance which usually comes with hard to understand jargon to the layman. The role of the financial regulatory authorities or institutions is to oversee a large section of businesses that engage in financial services, dealing with the retail customer, with the purpose of protecting the customers. For example, an insurance company (be it automobile or home or life insurance) usually falls under the jurisdiction of the financial regulator, just as an online forex brokerage would.

Role of Financial Regulators in Forex

The role of the financial regulator is to ensure that the businesses that have a financial license adhere to the general framework which includes transparency in reporting the day-to-day activities, maintaining enough liquidity to ensure that the transactions are filled as well as sending frequent accounting reports to the financial regulator.

While it might seem an expensive and an arduous task of obtaining a legitimate financial license, it does offer higher level of credibility for the businesses that obtain the license, including the online forex brokerages. Besides regulating forex brokers, the financial regulators also oversee any and all other subsidiary services such as Binary Options  brokerages. introducing broker businesses, forex signal services providers and managed account services.


Main Regulatory Organizations:

ASIC (Review of ASIC) – Australia Securities and Investment Commission (Australia)

CySec (Review of CySec) – Cyprus Securities and Exchange Commission (Cyprus)

NFA (Review of NFA) – National Futures Association (United States)

CFTC (Review of CFTC) – Commodity and Futures Trading Commission (United States)

FCA (Review of FCA) – Financial Conduct Authority (United Kingdom)

FSP (Review of FSP) – Financial Service Providers (New Zealand)


Regional Financial Regulators

Depending on where a business is registered and operating from, the forex broker or a financial business is mandated to obtain a license from the financial regulator. Besides having a business operating license financial services providers also need to obtain a financial license as well.

Below is a list of some financial regulators:

ASIC  – Australia Securities and Investment Commission

BVIFSC – British Virgin Islands Financial Services Commision

BCSC – British Columbia Securities Commission

OSC – Ontario Securities Commission

IIROC – Investment Industry Regulatory Organization of Canada

CySec-  Cyprus Stock Exchange Commission

MiFID – Markets in Financial Instruments Directive

Banque de France

BaFin – Bundesanstalt fur Finanzdienstleistungsaufsicht

HCMC – Hellenic Capital Markets Commission

SFC – Securities and Futures Commission

BAPPETI – Badan Pengawas Perdagangan Berjangka Komoditi

CONSOB – Commissione Nazionale per le Società e la Borsa

FSA Japan  – Financial Services Agency

FFAJ – The Financial Futures Association of Japan

JSDA – Japan Securities Dealers Association

FCS – Financial Services Commission

AFM – The Netherlands Authority for the Financial Markets

АВК – Financial Dispute Resolution

FSP – Financial Service Providers Register

KROUFR – The Commission on Regulation of Financial Markets Participants Relationships

CRFIN – Centre for Regulation in OTC Financial Instruments and Technologies

SGX – Licensed clearing member of the Singapore Exchange

MAS – Monetary Authority of Singapore

FSB – Financial Services Board

CNMV – Comisión Nacional del Mercado de Valores

Swedish Financial Supervisory Authority (Finansinspektionen)

GSCGI – Groupement Suisse des Conseils en Gestion Indépendants

ARIF – Association Romande des intermediares financiers

Swiss Federal Department of Finance

Organisme d’autorégulation fondé par le GSCGI

FINMA – Swiss Financial Market Supervisory Authority

DMCC – Dubai Multi Commodities Centre

FCA – Financial Conduct Authority

FINRA – Financial Industry Regulatory Authority, Inc.

NYSE – New York Stock Exchange

Office of the Comptroller of the Currency

Securities and Exchanges Commission

CFTC- Commodities and Futures Trading Commission

NFA – National Futures Association


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