OpenFX: does Belarus license keep your money safe?

What draws traders’ attention to OpenFX in the first place is the name of the dealing center itself. The broker mirrors the name of another market player, FxOpen. One may think that this is a coincidence, and no attempt is made to capitalize on the name of a more renowned broker. But is that so? Despite the alphabetical similarity, there are differences in reputation and customer-mindedness.

A huge number of real traders openly call OpenFX “a swindler who brazenly steals money”. There are some drops of high estimates in the bucket of negative feedback, though. The upside of this Forex broker seems to stem from the sovereign guarantee of the Republic of Belarus and hints at stability.

Publicly available data reveals that OpenFX dealing center is a brand of OOO Otkrytyie Investitsii. The company was registered on February 29th, 2016 by the Minsk City Executive Office (registration #192612632). The certificate of entry in the Register of Forex companies #1 of April 19th, 2016 was issued by the National Bank of the Republic of Belarus.

It is the role of the NBRB as the regulator that entices many novice traders from the CIS countries. Notably, though, the legal framework for regulation of operations of Forex companies has been in existence not for long, only since 2015.

According to the information about legal entities published on the NBRB portal, the company is registered at Minsk, Dzerzhinkiy avenue, 104, office 803 B, room 137. Activities of the broker are also regulated by the Belarus legislation.

This information checks out in a number of other databases: kartoteka.by, legat.by, and bizinspect.by. These show that the broker pays taxes and performs its activities transparently. The databases also contain information on ongoing court cases, indebtedness, and enforcement proceedings. At the time of this release, none was stated for OpenFX.

According to publicly available information, the dealing center is a partner of Dogmat investment group that, in 2007, bought Mezhdunarodniy Rezervniy Bank, a private Belarussian bank. Also, in 2017 OOO Otkrytyie Investitsii was awarded a certificate of correspondence to protocols of the Association of development of the financial market, i.e. the broker was registered with ARFIN.

The above credentials present OpenFX as a licensed broker, transparent taxpayer regulated by the government, and with no offshore registration. Yet, for some reason, the dealing center stays underestimated.

When it comes to actual traders cooperating with the platform, things become less unequivocal. Delays in deposit payments, slippage, requoting, malfunctioning of the trading platform and poor support. With a lot of red tape as the main way of withdrawing even the smallest profit. There are hundreds of such reviews!

There is no information on OpenFX’s website as to who supplies the liquidity, i.e. the source of quotes is unknown. Considering the Dogmat connection, it may be assumed that the quotes are supplied via the Mezhdunarodniy Rezervniy Bank of Belarus. No crime in itself but not comparable to liquidity provided by such stalwarts as Deutsche Bank, Morgan Stanley Barclays Capital, etc.

Users estimate OpenFX technical facilities as weak, which does not allow reacting promptly to market fluctuations. Order execution may take as long as 5 seconds. If you read the user agreement carefully, the broker states openly that its own force majeure is your problem. Particularly, Clause 8.3.4 has it that the company may cancel or revise the results of closed trade(s) of the Client if system malfunctions are found in the Forex terminal.

Another interesting provision is in Clause 8.3.5, and it allows OpenFX, notwithstanding any other clauses of the agreement, exclusively at its own discretion and without prior notification or assumption of any corresponding obligations, to limit or terminate the Client’s access to the Forex terminal and/or server of the company in case any of nine circumstances arise. You’d be wise to get yourself acquainted with all of them.

And here’s the corker – those who chanced at trading through OpenFX relate problems with money withdrawal. To take possession of your profit, you have to submit a request to withdraw to your real bank account. This is the only way to get the money you earned! This is required by the regulator. Only the initial deposit may be withdrawn to the credit card from which you replenished the account. In other words, if you deposited $100, this is exactly how much you would be able to withdraw to the same credit card. To withdraw the profit, you’d have to try harder!

This procedure leaves traders nonplussed and costs them time. And money, according to the feedback, is lost by trusting the consultants. Traders point out poor qualification of advisors that lead clients to draining their balance. According to the information available, about 50% of traders that trusted the investment programs of OpenFX lost their money.

In the end, the assessment of OpenFX is rather ambiguous. On the one hand, the broker is a proper legal business with a license and a state regulator, with not offshore registration. On the other hand, poor technical facilities and the many hoops to jump through just to withdraw the profit left traders dissatisfied and contradicts the dynamics of Forex trading. Downright swindlers? No.

A reliable broker? Only if you agree to the aforementioned risks, poor technical facilities, and the withdrawal red-tape.