Home / News / ED freezes OctaFX's bank account for illegal online forex trading

The Enforcement Directorate (ED) has frozen the bank account balance of OctaFX and its related entities to the tune of Rs. 21.14 crore in the case of Illegal Online Forex Trading through international brokers under the Foreign Exchange Management Act (FEMA).

The Reserve Bank of India had on Wednesday released an 'alert list' containing the names of 34 entities, including OctaFX, that are not authorised to deal in forex and operate electronic trading platforms in the country.

The alert list also included Alpari, HotForex, and Olymp Trade. In a statement, the Reserve Bank of India (RBI) said that resident persons can undertake forex transactions only with authorised persons and for permitted purposes, in terms of the FEMA.

Legal action under the FEMA would be liable if resident persons undertake forex transactions for purposes other than those permitted under the FEMA. Legal action would also be liable if forex transactions are undertaken on electronic trading platforms (ETPs) that have not been authorised by the central bank.

The central bank said it has been receiving references seeking clarification on the authorisation status of some ETPs.

In a statement, the RBI said, “It has, therefore, been decided to place on the RBI website an 'Alert List' of entities which are neither authorised to deal in forex under the Foreign Exchange Management Act, 1999 (FEMA) nor authorised to operate electronic trading platforms for forex transactions."

The list also contains the names of those entities that are neither authorised to deal in forex nor authorised to ETP for forex transactions under the Electronic Trading Platforms (Reserve Bank) Directions, 2018.

Other names that have been included in the red list are Forex4money, eToro, FXCM, NTS Forex Trading, Urban Forex, and XM. "An entity not appearing in the list should not be assumed to be authorised by the RBI," the bank said.

"Members of the public are once again cautioned not to undertake forex transactions on unauthorised ETPs or remit/deposit money for such unauthorised transactions," the RBI said.

(With agency inputs)

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