SBP rejects rumours of freezing foreign currency accounts
KARACHI: The State Bank of Pakistan (SBP) on Monday said that the...
Customers are being drawn to trade on several foreign currency trading platforms; like OctaFX, Easy Forex, etc. They have a significant advertising presence on popular social media sites like Facebook, Youtube, etc. On these platforms, a lot of people are trading and investing. Some investors have profited; while others have lost money. It has since been discovered that trading on these platforms is prohibited. Using applications, websites, or platforms like OctaFX to engage in foreign currency trading; leverage trading, or contract for difference (CFD) trading is dangerous and unlawful; according to a new SBP regulatory regulation.
Additionally, they are leveraging social media marketing to offer their products; to Pakistani citizens and entice them; to buy their products. Such purchases made by Pakistani citizens; are against section 4(1) of the FERA. Furthermore, it has been seen that Authorized Dealers (ADs); are making payments to these offshore trading platforms; through their payment gateways.
The SBP statement goes like this:
“Attention of Authorized Dealers (ADs) is drawn towards section 4(1) of the Foreign Exchange Regulation Act 1947 (FERA); which, inter alia, provides, “except with the previous general or special permission of the State Bank, no person other than an authorized dealer shall in Pakistan; and no person resident in Pakistan other than an authorized dealer shall outside Pakistan; buy or borrow from, or sell or lend to, or exchange with, any person not being an authorized dealer; any foreign exchange. Similarly, ADs attention is also invited towards section 5((1(a)) of the FERA which provides; “Save as may be provided in and in accordance with any general or special exemption from the provisions of this sub-section; which may be granted conditionally or unconditionally by the State Bank no person in, or resident in, Pakistan shall— (a) make any payment to or for the credit of any person resident outside Pakistan.”
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