How VIPortal got it wrong - demo for forex trading

How VIPortal got it wrong ~ demo for forex trading

Is Kenya’s VIPortal a true forex brokerage agency? Most of its staff represents themselves in the category of forex brokers. But what really constitutes a forex brokerage agency? You need to be a market maker- providing traders with an avenue to buy or sell currencies, commodities, futures, metals and many more. You also need to have a trading platform, a kind of software through which traders signing up with you will use in accessing the markets- the most popular software being the Meta trader 4. VIPortal had or has none of these services.
There is a rush among the Kenyan public to say that VIPortal were scammers. I do not believe that. It made some mistakes, but most of it was in good faith. But that should not mean that I aim to vindicate them. To the extent that they did call and still represent themselves as online forex brokers I would want to say that they were wrong. A forex broker never executes trades on behalf of a forex trader. Defining itself as a forex brokerage agency is probably the first act that brought VIPortal to the attention of the Central Bank of Kenya. In effect the entity was handling money from the public and needed to have a permit showing they are regulated by the Central Bank of Kenya. They could not just open up financial offices without co opting the rules of the institution mandated to regulate financial matters.

The above could have been a result of unsound legal advice that VIPortal got from its lawyers. But there are other ways that VIPortal self inflicted itself with the damage that befell it a few months after starting its operations in Kenya. But first we must commend it for the courage to start the first real forex trading movement in Kenya. There were no prior homegrown forex entities from whom they could have learnt from. There are also no legal Kenyan precedents in relation to the trading of forex online that could have guided them on how to deal with their clients or the Central Bank.

VIPortal was the first entity that attempted to do anything in relation to forex on such a massive scale. There are numerous so called forex tutors around Kenya, but none has the level of sophistication and staff as was the case with VIPortal. Its clientele was also the largest ever as far as online forex in Kenya is concerned. A lot of forex traders that trade for other Kenyans do not have an address save for a mobile number or an email address. Forex trading in Kenya is still the stuff of the underground movement because of the uncertainty that surrounds it after previous pronouncements by the Central Bank Governor.

VIPortal attempted to break out of that underground movement and bumped into the scene with pomp and color. It set up offices in Naivasha, Kikuyu, Corner House at the Nairobi business district and spread its wings as far as Mombasa. This made it an easy target of the Central Bank. With a permanent address and a growing number of Clientele, it was only a matter of time before this entity was on a collision path with the Central Bank of Kenya. Soon, some of its staff were guests of the State.

By breaking off the underground movement, VIPortal isolated itself. It will now be a long journey to reclaim back the good will of the Kenyan public who had invested much hope and capital with them. But what could VIPortal have done to safeguard its interests and that of its clientele from the prying eye of the Central Bank of Kenya? That will be the subject of our next article.
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