OctaFX is a trading platform that enables customers to engage in forex transactions. The official website demonstrates success by highlighting that it grants access to a wide range of assets, currencies, and shares, among other products. It further boosts the offering of low spreads and low commissions, with only $20 required to be deposited in the account.
However, all that shines is not gold; the same could be true for OctaFX. This is based on an investigation being carried out by the ED in India, wherein OctaFX is facing charges of illegally operating in the country. Needless to say, the Forex platform stands bold on its stage with a commitment to continue providing the best services.
ED crackdown on OctaFX illegal forex trading in India
A forex platform performs the task of brokering the deal on behalf of the customers. It often includes services such as educational and analytical tools. These help to better understand how the graph is moving for a particular currency pair, say INR/USD.
ED, an acronym for the Directorate of Enforcement, has begun cracking down on platforms operating without legal identity. ED has found some of them misrepresenting Indian customers and using their funds for purposes other than what is stated to them. OctaFX, for one, was found directing the funds to buy cryptocurrencies.
Funds received by OctaFX were transferred to the bank accounts of dummy entities. OctaFX only used a certain portion of the funds to buy cryptos, not the entire portion. Most of them have also been found violating FEMA regulations and operating without acquiring a license from the RBI (Reserve Bank of India). The list made public in early June 2023 includes Guru Trade7 Limited, Rubik Trade, and Trust Trade, among others.
OctaFX in India: Legal or Not?
Questions are being raised about OctaFX’s legality. Naturally, the OctaFX, one of the leading forex brokers in India has defended itself, saying that it acquires a license in a jurisdiction where its operations are not restricted to serving customers. It has further said that some regulators often impose rules and regulations that are rigorous in nature, forcing the platform to work under stringent trading conditions.
This would have made sense had OctaFX not added that it holds a license under FSCA and CySEC. A case of OctaFX illegal forex trading only gains strength from the assumption that it has selectively chosen not to follow the regulations of a certain country—India in this case.
The last notice made it clear that OctaFX holds no legal position in India and is in violation of FEMA regulations. M/s OctaFX and related entities are under the scanner for illegal online forex trading. OctaFX has stated that it operates in India and intends to continue to operate in the country. If customers should be concerned about anything, it is the rise of fraudulent activities in the name of OctaFX.
Having talked about the status of OctaFX, the RBI has clarified that no platform should be assumed to be legal if it does not appear on their list. A platform, legal or illegal, appears on the RBI’s list only after it has come under the radar and investigations have begun. A platform that does not appear on the list may be yet to be investigated on a full scale.
The Directorate of Enforcement is showing no signs of stopping. The ED will continue taking action against illegal forex operators. OctaFX is under the radar for not acquiring a license from the RBI and violating FEMA regulations. As it continues to operate in India, traders are recommended to exercise due caution before engaging with the platform.
A license is equivalent to a protective umbrella for customers who are largely at risk of losing their funds if, in that case, a brokerage platform of any kind shuts its doors. This does not undermine the achievements of OctaFX that it may have registered in jurisdictions where it holds a license.