The Bank of Russia opens Centre of Excellence for counteracting illegal activity in the financial market

Photo: issaro prakalung / shutterstock

The Centre, opened in Krasnodar on 2 February, will accumulate information concerning illegal activities in the financial market from all over the country. The Centre’s primary objective is to analyse the data and develop a methodology for identifying and suppressing such activities. The database and the methodology will be available to all structural units of the Bank of Russia working in this area.

This approach will make it possible to track the migration of fraudulent schemes and prevent them from spreading at early stages, identify their organisers, and build more efficient cooperation with enforcement authorities and the public.

‘We are interested in the qualitative growth of the Russian financial market and must protect the competitive environment from distortion. However, if illegal business is abundant, it drives legal business out. Moreover, such illegal business is only one-off, because it is based on deceiving consumers. The prosperity of our citizens is the ultimate goal of our economic policy’, the First Deputy Governor of the Bank of Russia, Sergey Shvetsov, was quoted as saying at the Centre’s opening ceremony.

Counteracting fraudulent schemes, such as financial pyramids, ‘black creditors’, false insurers, illegal FX-dealers, and other firms providing licensed financial services without proper authorisation, is one of the priority areas of activity of the Bank of Russia. The operations of such institutions violate consumer rights, lead to increased prices for legal financial services, and create an inherently unequal competitive environment for bona fide market participants.

Therefore, the regulator is proactively expanding its regional activity. Sections responsible for counteracting illegal practices are being currently established in all main branches of the Bank of Russia.

2 February 2018

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