Russia's approach to retail foreign exchange was unusual: rather than folding it into general securities regulation, the law created a distinct category of professional participant, the forex dealer, supervised by the Bank of Russia. The regime set out what a forex dealer may do, required membership of a designated self regulatory organisation, imposed capital and reporting obligations, and restricted what could be offered to individuals resident in the country. The stated intention was to shrink a market that had been dominated by offshore firms marketing to Russian residents, and it did shrink it, mainly by making authorisation demanding enough that only a small number of firms pursued it.
The Bank of Russia is the megaregulator for the whole financial sector: banks, insurers, pension funds, market infrastructure and professional securities market participants. It maintains public registers of licensed entities, and the forex dealer register is where the authorised firms appear. That register, not any third party list, is the authoritative source on who actually holds the licence at any moment.
Why the regime is narrow by design
Several features of the framework work together. Forex dealers must be Russian legal entities, so a foreign broker cannot simply extend an existing licence into the market. Contracts with individual clients are subject to prescribed terms. Client relationships are documented under a framework agreement registered with the self regulatory organisation. Leverage available to individual clients is limited by regulation. Capital and reporting requirements sit at levels intended to exclude thinly capitalised operators. The combined effect is that the compliant version of the business is expensive to run and constrained in what it can offer, while the non compliant version, marketing from offshore, was what the law was written to suppress.
That design tension is not unique to Russia. The same pattern appears wherever a country writes tight domestic rules while an offshore industry markets into it, and the enforcement tools are always similar: website blocking, payment blocking, advertising restrictions, warning lists and action against local intermediaries. What differs is how aggressively they are used.
Nothing in this article should be read as encouragement to serve Russian residents from outside Russia. It exposes a firm to enforcement, exposes clients to payments that may be unlawful or simply frozen, and creates sanctions risk for everyone in the payment chain. Where the honest answer is that a route has serious consequences, that is the answer.
The sanctions layer changed the practical question
Since 2022 the operative constraint for any non Russian firm is not the licensing regime. It is sanctions. Multiple jurisdictions have imposed extensive measures affecting Russian banks, individuals, entities and sectors, including restrictions on financial services provision and the removal of certain Russian banks from international messaging infrastructure. Those measures apply to the firms in the payment chain regardless of where the broker itself is licensed.
Practically, this shows up as follows. Correspondent banks apply enhanced due diligence or refuse exposure to Russia connected flows entirely, which means a bank holding your account will ask about client nationality and residence and may restrict the relationship based on the answers. Card schemes and acquirers apply their own restrictions and country rules. Payment providers screen counterparties, beneficial owners and payment intermediaries against sanctions lists and will block anything that hits. Liquidity providers refuse counterparties whose client base creates exposure they cannot explain to their own compliance function. Advertising platforms and app stores apply their own country availability policies.
The screening obligation itself is not optional and not delegable. Every firm has to check clients, beneficial owners, payment counterparties and sometimes intermediaries against the lists that apply to it, and the difficulty is not running the check but handling the volume of near matches sensibly. The mechanics are covered in sanctions screening basics, and the related know your customer layers in verification levels.
What this means for firms elsewhere in the region
Firms operating in neighbouring jurisdictions carry the consequences whether or not they touch Russia. Banks in Georgia, Armenia, Kazakhstan and the Baltics face persistent correspondent questions about circumvention risk, and they pass those questions down to customers whose client base includes Russian nationals resident elsewhere. That is not a hypothetical. It is the single most common reason regional trading firms lose banking, and the answer that keeps an account open is documented process: nationality and residence captured properly, source of funds evidence, payment routing that is transparent, screening that is logged, and a compliance officer who can explain any of it on request.
The firms that handle this well treat it as an operational problem with a data answer. Client records need to hold the fields that a bank will ask about, and they need to be exportable on short notice. That is a plain requirement of the systems a firm runs, and it is one of the things a properly built Broker CRM exists to make routine rather than frantic.
The position
For a foreign firm, Russia is not an accessible retail market under current conditions, and no licensing structure changes that, because the constraint sits in sanctions law and in the private risk decisions of every bank and payment company in the chain. For firms in the wider region, the correct posture is documented, defensible screening and a clear account of who your clients are and where their money comes from. Anything less is a bank account waiting to be closed. See also how listing decisions ripple through banking.
SINGUARD is a software company. We do not hold a financial licence, we do not provide legal or compliance advice, and sanctions questions must be taken to qualified counsel in the jurisdictions that apply to you.
"No structure gets you around sanctions. Every bank in your chain is making its own decision, and one of them saying no is the same as all of them saying no."
— Alex Onta, Executive Director, SINGUARD
Key Takeaways
- Russian law created a distinct forex dealer licence supervised by the Bank of Russia, requiring a Russian legal entity and membership of a designated self regulatory organisation.
- The regime was written to be narrow, with prescribed client contracts, regulated leverage limits for individuals and demanding capital and reporting obligations.
- Since 2022 sanctions, not licensing, are the binding constraint for foreign firms, and they bind every bank and payment company in the chain.
- Firms across the wider region need documented screening and clean client records because correspondent banks push circumvention questions down to them.
Frequently Asked Questions
Who supervises forex dealers in Russia?
The Bank of Russia acts as the country's financial megaregulator and maintains the public registers of licensed participants, including forex dealers. Its register is the authoritative source on current holders.
Can a foreign licensed broker serve Russian residents?
The Russian regime was built around domestic entities, and sanctions imposed by multiple jurisdictions now restrict financial services provision and payment flows. Any firm considering this needs qualified legal advice, and the practical answer under current conditions is that the route carries serious consequences.
Why do banks in neighbouring countries ask so many questions about Russian clients?
Because their correspondent banks apply enhanced scrutiny to circumvention risk. The questions travel down the chain, and a customer who cannot evidence nationality, residence, source of funds and screening logs becomes the easiest relationship for the bank to exit.
About the Author
Alex Onta is an Executive Director at SINGUARD. He built eTrader, the terminal, the mobile apps, eTrader Broker, Copytrading, Business and Community, along with the worldwide clustered-server infrastructure it all runs on, with his brother Roman Onta helping on the design, and he leads that division today. Together with Roman he builds the Prop Firm CRM, the Broker CRM, Scalegram and CopySignals, and the two of them carry worldwide compliance, payment processing and international business structuring side by side. He lives and works in Dubai for most of the year. Meet the executive duo leading Singuard's five divisions.