Exclusive: Police Raid FX and Binary Call Centers in Albania

Unregulated brokers are on the rise into the implementation of the ESMA’s new regulation

Albania is the next Eastern-European country that is starting to take action about call centers which are typically soliciting Western-European clients to deposit their savings into high-risk financial products. The country has become a hub for binary options and forex call centers over the past several years with the Italian market being one of the main sales targets.

About a month ago Finance Magnates exclusively reported about a coordinated police raid in Ukraine. Call center operators have frequently moved their locations across Eastern Europe. After being popular destinations for outsourcing since about a decade ago, Bulgaria and Romania ceded their spots to countries like Serbia, Montenegro, Bosnia and Herzegovina, Ukraine, and apparently Albania.

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A source with close knowledge of the matter shared with Finance Magnates: “There is a big big problem there, mainly for Italian facing brokers. I give legal services to several call centers and IBs who closed their operations and are moving to Serbia, Kosovo and other places in the area, while others are still active.”

More Raids

Other sources familiar with Albanian call center operations shared that competition between different establishments could have caused the raid. Allegations about the involvement of the local tax authority reminisce of other Eastern European raids.

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The number of unregulated brokers which are targeting EU clients has increased materially over the past year. The upcoming regulatory shift could well accelerate this trend.

After our report in early May about some police raids in Ukraine, we can now confirm that more sporadic visits from local enforcement have been paid to call centers in Kharkiv and Dnepropetrovsk.

A Long Saga

FX and binary options call centers have frequently been targeted by legal authorities worldwide. The hot sales practice which eventually led to the ban of the binary options product in the US and the EU has attracted attention on the part of regulators as losses among unsophisticated investors reached millions.

The US CFTC has been the most notorious enforcer of drastic financial sanctions against binary options brokers, ultimately settling with Banc de Binary for $11 million. European authorities have been less successful in issuing adequate fines for illicit binary options operators. While the CySEC has fined some companies, the amounts have been minuscule when compared to the

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