Head of the company Finacom PLC Limited PETER TATARNIKOV: “At the Forefront of Technological progress”
During the recently held IFX Expo in Limassol, we managed to talk with one of the key participants of the exhibition, Peter Tatarnikov, the head of the company Finacom PLC Limited and also the Chairman of the Board of Directors of the Financial Commission.
Peter’s career began in 1999 as an assistant in the dealing department in Russia and, in 2011, he created and headed his own consulting group in New York. During his career, Peter conducted more than 200 seminars on trading in the Forex market and also advised the Central Bank of the Russian Federation on western models of regulation for the Forex market. A well-known trader, Alexander Elder, included in his book “I & Exits” an entire chapter devoted to Peter’s trading strategy.
The Finance Commission is an independent organization that specializes in settling disputes between brokers and traders working for Forex. In its work, the Commission focuses on transparency and ease of interaction. The Finance Commission participates in all of the significant events of the Forex industry around the world, including in China, Russia, Great Britain, Ukraine and Hong Kong.
How many claims do you receive per month and what is the average time for their consideration and decision? If the decision is made in favour of the client, do the companies make a general decision or is the discussion on-going? What happens to cases that cannot be resolved?
Approximately 20 claims per month are received and claims are not simply complaints of clients, but claims. The average time for consideration of the claim is 12-14 days. The decision cannot be negotiated with the broker. First, we collect information from the client, then from the broker, and then we look for possible options for resolving the claim before it gets to the committee. Sometimes, the situation is settled before it gets to the committee. We always try to resolve the claim at the stage of its investigation. After it gets to the committee, a final decision is made, which is not subject to appeal, except for cases when the client, himself, lodges an appeal if he is not satisfied with the amount of compensation.
There are several members of the committee working on each claim (at least three of them). The committee, itself, is an independent body and members of the committee are selected according to the specifics of each particular claim. Insoluble claims do not exist. The decision will be made in any case and the broker will be obliged to fulfil it. Otherwise, it will be waived from the Finance Committee. If we register a surge of claims on a single company, this may be the reason for listing this company in our so-called “warning list”. There is a whole list of such companies that we do not recommend to our customers.
Does the Financial Commission contact and cooperate with the Securities & Exchange Commissions in which the companies are registered?
No, we do not cooperate with them. We are an independent organization, but, in any case, we are always open to this cooperation, in some necessary cases.
Does the Commission recommend companies to improve trading platforms? Do they listen to you?
Undoubtedly, we give recommendations and not only to improve trading platforms, but also on the practice of execution of orders, on client service and on many other issues that arise in the process of reviewing claims…and, of course, they get attached to us.
How does the financial committee resolve cases, with low and high volatility (coefficient characterizing market fluctuations)?
With increasing volatility (prices fly top down) in the market, traders become the most active. In this case, there are often situations where client orders are executed not at the prices that they ordered, but for worse ones. This is the reason for the increase in the number of claims from customers, because the client does not fully understand the process of execution of orders in the foreign exchange market. In this case, we analyse whether the execution of this warrant was lawful and whether it was possible to execute this warrant at the best price. Then, on the basis of this analysis, we make some decision.
Does the commission take a percentage of compensation as a service price from the client or are there no such rates? Do brokers pay for membership?
The client (trader) does not pay anything at all. For him, all services of the financial commission are free. The broker voluntarily joins our organization and pays the membership fees so that his clients have an opportunity to consider disputes with the client in an independent, so-called “arbitration court”. This is a kind of application from the broker that he is doing business honestly; that is, joining our commission is a kind of a quality broker sign.
How easy is it for a client to register a complaint?
It’s very simple. It is enough to go to our site and fill out an online form from which we can begin to consider the claim.
Do companies provide information about the commission on their websites, in case the customer wants to access it?
Yes, the company is obliged, by our agreement, to post information on its website so that a way of resolving the situation for the client is available.
Recently, the situation in the markets and in the Forex industry has become more complicated. Volatility in real markets has fallen somewhat, regulators are becoming stricter and regulated companies are required to maintain full transparency, efficiency and full disclosure of trading transactions. Therefore, the interest in the Forex market is reduced, as are the orders for transactions. What is your plan of action if the Forex market loses the interest of potential clients?
I would not agree with you about the decline in interest. On the contrary, I see that volatility has returned to the markets, compared to, for example, in 2014, when volatility was at a minimum and many companies left the market altogether. Volatility is the basis for earnings for a dealer, but now we see that regulation is really getting complicated, which is absolutely normal, and the interest of clients has not fallen because if the interest of clients in the market did fall, regulators probably would not have taken any additional actions to tighten control.
First of all, this is noticeable in terms of the number of claims from our clients; a number which is growing every year. The geography of claims is expanding immensely and, therefore, we provide consideration of claims in 8 languages and this is very serious. We believe that one of our main functions is enlightenment. We give our customers very detailed answers about what caused the issues and how to proceed. That is, in essence, the client gets an education, which is very important and, therefore, our clients appreciate it. We are not a brokerage organisation. We live on the income of membership fees and, recently, we introduced on-line training courses for our clients and plan to expand their scheme of topics.
You represented your company here in Cyprus at IFX last year. What can you say about the current exhibition in Cyprus compared to last year?
This year, of course, there were more and companies and more visitors. The exhibition in Cyprus, in my opinion, is one of the most significant in the world. A splendidly organised exhibition that allows you to create lucrative networks, see some innovations and get acquainted with some new companies. This is the right place to be; at the forefront of technological and managerial progress.