The Financial Commission, a self-regulating body for the Retail Trading industry, released its annual report for 2018 this Thursday.
Currently, the self-regulatory body has 21 foreign exchange and contracts for difference brokers on its books.
Traders who lose funds with a member broker are protected up to 20,000 euros ($22,694).
Though many might doubt the efficacy of the body, its report indicates that it is having an increasing impact on resolving conflicts between brokers and their clients.
For instance, last year the firm was able to recover $784,380 for broker customers. That money was paid out across 153 disputes that were awarded in traders’ favor.
That was a big decline on the prior year’s $1,564,700 but, as this is a dispute resolution service and not a company looking to grow each year, that shouldn’t necessarily reflect badly on the Financial Commission.
Bad advice
Positively, the majority of that cash, $618,566, was taken back from brokers due to ‘non-trading disputes.’
The majority of those ‘non-trading disputes’ were related to ‘advice’ given by brokers to their clients.
Of course, if a broker is fond of b-booking all of their clients, they may be tempted to give poorer advice than they otherwise would.
One criticism that could be put to the Financial Commission is that its focus is overwhelmingly on Russia and other countries that were once part of the Soviet Union.
A large majority of traders that brought disputes to the organization spoke Russian, with 64 percent of all complaints made in the Slavic language.
After Russian, the next most common language was English. According to the Financial Commission report, 21 percent of traders made their complaint in English but, as the language is more universally spoken than Russian, it may be the case that a smaller fraction of people actually spoke it as their mother tongue.
