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Riot police in the offices of one of Russia's largest brokers: the TeleTrade story

In 2016 the offices of TeleTrade — one of the three largest regulated forex brokers in Russia — were raided simultaneously by OMON riot police on suspicion of fraud. This was not a raid on some underground fly-by-night operation, but a forceful action against a leading, legally licensed player in the market. Investigators seized computer files, documents and, according to law enforcement, evidence that the company's trading systems had been deliberately configured to work against its clients.

For years TeleTrade was among the three largest forex dealers operating in Russia under official regulatory oversight, and it positioned itself as a reliable, licensed broker with an extensive network of branch offices. It was precisely its status as one of the systemically important players in the regulated market that made the company especially trusted in the eyes of retail traders.

In June 2016, TeleTrade's offices across the country were raided simultaneously by OMON riot police as part of a criminal case alleging the embezzlement of hundreds of millions of rubles in client funds. According to investigators, the company's trading platforms had been technically configured to operate against the interests of clients. In October 2016 the company's owner, Vladimir Chernobai, and his nephew Oleg Suvorov were charged with fraud in absentia — at that point they were outside Russia, and the proceedings against them were conducted in their absence.

The regulator delivered the final blow: on 27 December 2018 the Central Bank of Russia revoked TeleTrade's licence along with the licences of several other major forex dealers, including Alpari and Forex Club, officially citing inaccurate reporting, violations of the procedure for calculating the company's own capital, and failure to meet deadlines for submitting reports to the regulator. The licence ceased to be valid on 27 January 2019 — and the regulator's wording echoed almost word for word what the raids had pointed to two years earlier.

Why this mattersThe status of being "one of the country's largest regulated brokers" is no guarantee against fraud — regulators frequently react to violations only after the fact, sometimes years after the problems had already become obvious in practice. Our experience at Carrara e Associati shows that the longer a client waits for a situation with a broker to "resolve itself", the smaller the chances of recovering funds — early legal advice significantly improves the odds of success.

Published 20 August 2021

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