BB to take actions against illegal currency trading
Sunday, 15 January 2012
Bangladesh Bank (BB) is taking legal steps against the persons and the institutions who are offering people illegal currency trading through internet and electronic trading portals, reports BSS.
The central bank last week issued a statement advising people not to involve in this illegal business and warning them of stern consequences for such activities.
In the statement, the BB referred to some recent advertisements in the media including in ICT-based magazines, those offered people training courses for earning high return from online foreign exchange trading and dealing.
The BB said these advertisements also offered currency loading facility in debit cards to run the online foreign currency exchange business by taking the 'risks' of the 'daily fluctuation of exchange rates'.
"This sort of trading and dealing by unauthorised people and organisations are entirely illegal as per the Foreign Exchange Regulation Act 1947, which allows only licensed dealers and money exchangers to run such business," the BB said.
It advised people to refrain from responding to such tempting, but illegal offers and warned respective advertisers of punitive actions.
An official of BB told the news agency that most of the web-based foreign exchange transactions are carried out on margining basis with huge leverage or on an investment basis, where the returns are based on currency trading.
People are advised to make the margin payment for these transactions through their credit or debit cards, which are not only illegal, but also involve high risk of losing their total credit or debit limit to unknown people.
He said people in many countries including in neighbouring India were engaged in such flawed foreign exchange business on promises of exorbitant return from advertisers when many suffered ultimate losses.
The Reserve Bank of India (RBI) in April last year issued similar warning against such business and cautioned people of the financial and legal risks of these activities. The RBI also advised banks to exercise due caution and be extra vigilant in respect of such transactions.
The central bank last week issued a statement advising people not to involve in this illegal business and warning them of stern consequences for such activities.
In the statement, the BB referred to some recent advertisements in the media including in ICT-based magazines, those offered people training courses for earning high return from online foreign exchange trading and dealing.
The BB said these advertisements also offered currency loading facility in debit cards to run the online foreign currency exchange business by taking the 'risks' of the 'daily fluctuation of exchange rates'.
"This sort of trading and dealing by unauthorised people and organisations are entirely illegal as per the Foreign Exchange Regulation Act 1947, which allows only licensed dealers and money exchangers to run such business," the BB said.
It advised people to refrain from responding to such tempting, but illegal offers and warned respective advertisers of punitive actions.
An official of BB told the news agency that most of the web-based foreign exchange transactions are carried out on margining basis with huge leverage or on an investment basis, where the returns are based on currency trading.
People are advised to make the margin payment for these transactions through their credit or debit cards, which are not only illegal, but also involve high risk of losing their total credit or debit limit to unknown people.
He said people in many countries including in neighbouring India were engaged in such flawed foreign exchange business on promises of exorbitant return from advertisers when many suffered ultimate losses.
The Reserve Bank of India (RBI) in April last year issued similar warning against such business and cautioned people of the financial and legal risks of these activities. The RBI also advised banks to exercise due caution and be extra vigilant in respect of such transactions.