Financial trading regulators have one of the biggest responsibilities – to protect consumers from scams, and frauds, and to take care of their safety. In the Forex market, as well, financial regulators play a major role as they try to prevent consumers from getting victims of fraudulent companies; in addition to that, they monitor evolving markets and risks that might be linked to financial trading and negatively affect the consumers. In this article, we’ll quickly review some of the most famous and reputable financial trading regulators around the world, including:
- CySEC
- FCA
- ASIC
- NFA/CFTC
- SCB Bahamas
CySEC
CySEC, short for the Cyprus Securities and Exchange Commission, is the country’s financial authority. The Cyprus Securities and Exchange Commission (CySEC) is an independent public supervisory authority charged with monitoring the Republic of Cyprus’ investment services market, as well as the Republic’s transferable securities transactions and its collaborative investment and asset management industries.
Because of CySEC’s mission to make the Cyprus securities market one of the world’s safest, most dependable, and most attractive investment destinations, a large number of foreign retail brokerage firms and binary options brokers have gained registration from CySEC.
FCA
The Financial Conduct Authority (FCA) implements, supervises, and enforces international norms and laws in the UK as part of its role as conduct regulator for the roughly 60,000 financial services businesses and financial markets in the country. The UK regulatory agency has the ability to enforce regulations via criminal and civil means. The FCA is also responsible for monitoring foreign exchange brokers regulated in the UK, like XM, Pepperstone, and HYCM Forex brokerages. It should also be stated that the regulatory body oversees the trading infrastructure that underpins the retail and wholesale financial markets and is responsible for the prudential regulation of enterprises that are not regulated by the PRA.
Financial Conduct Authority (FCA) has the authority to prohibit financial products for up to a year and to contemplate an extended ban, demand that businesses immediately withdraw or adjust advertising it deems deceptive, and disclose the results of these actions.
ASIC
Registered businesses, financial markets, and providers of financial services and credit services in Australia are all subject to oversight by the Australian Securities and Investments Commission (ASIC). The Australian Securities and Investments Commission seeks to foster financial markets that are open, competitive, and free from fraud, while also encouraging investors and consumers to make well-informed decisions.
The Australian Securities and Investments Commission (ASIC) is in charge of the country’s financial services licensing system, which it uses to grant licenses to firms and then oversee their operations to ensure they are honest and ethical in their dealings with customers. It should also be stated that since July 2012, these companies have been offering services related to financial goods, such as controlled emissions units. The Australian Securities and Investments Commission (ASIC) maintains a database of licensed financial service providers and their authorized agents.
NFA/CFTC
Independent from government oversight, the U.S. futures, and derivatives markets are governed by the National Futures Association (NFA). The goal of the National Futures Organization (NFA), a CFTC-recognized “registered futures association,” is to defend derivatives market integrity, safeguard investors, and guarantee that NFA members comply with all applicable regulations.
When Congress established the CFTC, it also gave the agency the power to organize registered futures groups and oversee the business dealings of its members. Only the NFA can claim to be a legitimate futures trade group. NFA is under the purview of the CFTC’s Division of Swap Dealer and Intermediary Oversight (DSIO). The DSIO frequently reviews the NFA’s performance in relation to its duty to audit futures and swap markets intermediaries for compliance with the applicable sections of the Commodity Exchange Act, CFTC regulations, and NFA rules. All the NFA does is work in close coordination with the Commodity Futures Trading Commission. The CFTC must approve all major measures taken by the NFA, including revisions to rules, enforcement actions, and registration activities.
SCB Bahamas
Established in 1995 under the Securities Board Act, 1995, the Securities Commission of The Bahamas (hereafter “the Commission”) is a statutory organization responsible for regulating the securities industry in The Bahamas. The new law subsequently superseded that Act, which has been abolished. The Securities Industry Act of 2011 establishes the scope of the Commission’s authority (SIA, 2011). The Commission’s job is to oversee and regulate the investment funds, securities, and capital markets in accordance with the Investment Funds Act of 2003 (the IFA) and the Securities and Exchange Act of 2011 (the SIA).
Throughout The Bahamas, the Financial Services Industry is supervised and regulated by the Securities Commission of The Bahamas (SCB). The SCB’s website details its regulatory processes, the laws it upholds, the publications it produces, and important information for investors.
Is It Difficult To Be Regulated By Mentioned Financial Trading Regulators?
Each regulatory is considered a prestigious one that requires the highest standards of fairness and safety. If you want to be a safe and trusted financial trading platform on the market, you need to have one of the mentioned licenses. But getting their license is not easy to access.
The cost of registration is different and depends on the jurisdiction. If you want to avoid registration fees and want to register in offshore jurisdictions, you must consider that it will reduce your trustworthiness to customers as well as to investors.
The next thing you have to consider is the waiting period. It can last a few weeks or even a year. During this period you are allowed to continue your financial trading. Licenses have expiration dates. For example, for the FCA it is a maximum of two years. Also, many of those require proper tests to confirm that your knowledge is suitable for effective SMF. These regulators are well-known for their high-quality safety. This is why their regulations on violations are quite strict and include thousands of USD penalties.
To conclude, getting a prestigious license is a difficult and complex process but it also requires maintaining the highest safety standards and accepting regulator requirements permanently.
