State bank has not yet licensed any forex exchange

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Illustrative photo.

At the regular Government press conference on December 2, information on legal issues surrounding forex exchanges, especially Liber Forex exchange, Dao Minh Tu, Deputy Governor of the State Bank of Vietnam, said that as per current regulations in Vietnam, only credit institutions licensed to deal in foreign exchange are allowed to provide foreign currency trading and derivative services in the domestic and internationalmarkets.

“So far, the State Bank has not licensed any forexexchanges. All current forex exchanges are not consistent with regulations. People and individuals who invest in these exchanges are supporting a violation," Tu stated.

According to the Deputy Governor of the State Bank of Vietnam, these forex exchanges have violated the law and are not recognized for business. If people participate in the exchanges, causing risks, they will not be protected by the law.

Tu also said that amid theCovid-19 pandemic, it is difficult to earn a few dozen percentof business profits for many businesses. The profits and interest rate of nearly 200% provided by Liber Forex has showed signs of fraud.

"The people need to pay attention to whether the investment offers are suitable with the practice or consistent with the law or not,” Tu said.

Deputy Minister of Industry and Trade Do Thang Hai said that Liber Forexexchange has a level of commission payment, so this is a multi-level business.

However, the Ministry of Industry and Trade has not issued acertificate of multi-level sales to any company named Liber Forex or Forex. Moreover, according to the Government's regulations, multi-level business activities are only applied to goods, while trading in the forexexchange is not goods, so it is illegal and banned operation.

Therefore, he also recommended that people should not participate in these exchanges, because many risks may incur, and people will not be protected by law and authorities.

In particular, the Deputy Minister of Industry and Trade emphasized that, in addition to the risks of assets, traders and brokers in illegal foreign currency trading floors have violated the law and shall be fined up to VND5 billion or face up to five years in prison.