do not think about this, because here in india it has not been introduced by any indian govt. governing body so no broker is here. if you are trading with a overseas broker and funding your account within the RBIs $5000/year policy then what is illegal. yes it may be illegal if any broker co.makes its office in India.
Reliance is also doing in same way.They are working as introducer broker of cmc market london. reliance is opening the clients account directly with that company.