ISLAMABAD: State Bank of Pakistan (SBP) on Wednesday declared use of forex trading platforms including OctaFX and Easy Forex illegal in Pakistan. The central bank has warned such companies of legal action for violating the rules and regulations for forex trading.
Most of the Pakistanis who use forex trading as a source of primary or passive income consider the use of platforms like OctaFX legal in the country, but the SBP has put all sorts of ambiguity to an end by declaring off-shore forex trading companies unlawful.
The SBP said all offshore forex trading platforms, websites and mobile applications are illegal.
Social media used for convincing people to invest
It added that offshore platforms like OctaFX are rendering forex trading services and products such as margin trading, contract for difference (CFD) and others to Pakistanis and advertise themselves on the social media platforms to convince people to invest.
In the public interest, the central bank categorically said the residents of Pakistan are prohibited to use any product offered by forex trading platforms.
SBP warned that a resident of Pakistan who uses products and services of such offshore platforms and sends money directly or indirectly through any payment channel can be prosecuted for violating the Foreign Exchange Regulations Act (FERA) 1947.
It said such platforms are neither regulated by SBP nor the Security Exchange Commission of Pakistan (SECP) and advised the people to refrain from investment in such platforms to avoid potential loss and action under FERA.
How these platforms help in capital flight
Notably, offshore platforms like OctaFX lure people of through different products of forex trading. All these platforms, operated from abroad, have a huge client base in Pakistan with investments worth million of rupees.
The people associated with forex trading said that they buy dollars for trading through Skrill – a digital wallet which offers a range of online payment and money transfer services. They said the money earned through trading can be withdrawn in any part of the world.
