Are Your Funds Safe? NFA to Shut down small forex fcms

[juxtatrader]

IFX will be fine! Thats if this is passed! Also, a big business transaction happened with them to make them even more powefull.

[uptick]

Originally Posted by forex savior

Big news people. The national futures association is going to shut down any firm that does not have at least $5 million in capital if the proposed capital requirement rule passes. This could get ugly folks. Is your firm big enough to make the cut? Most firms are poorly capitalized.

http://www.cftc.gov/files/tm/fcm/tmfcmdata0704.pdf

The rule should be decided in August. Make sure your funds are safe.

Thats good news. $5 million is nothing. You shouldn't be trading with a flimsy firm in the first place. That's my opinion.

Thumbs up to the NFA/CFTC.

[forex savior]

The CFTC has finally released the December 2007 net capital numbers. This is our first look at the forex industry after the increase in capital requirements to $5 million in the United States.

I'm amazed that firms like Advanced Markets and Bacera made the cut, although judging from their paltry capital numbers they are barely treading water. In light of the One World and FXLQ fiascos I would view those cap numbers with extreme skepticism. These are not safe firms in my opinion.

An interesting piece of data as well is the number InterbankFX is now reporting. Their cap number has dropped dramatically from $30 million to $19.2 million in one month. Often times cap increases and decreases can be written off as being part of the forex business cycle. But the fact is over that same period of time the FXLQ scandal ruptured and it turns out Interbank had some $10 million stashed away at FXLQ. Something to keep an eye on here people. http://www.robbevans.com/pdf/forexlqreport01.pdf

Here is the full run down of net capital per firm. Remember the Congress is close to passing a law which would require firms to have a minimum of $20 million to stay in business. Should it pass the industry may only have about a dozen firms left.

The Big Six (Above $20 Million)
1. Oanda $156 million
2. RJ O'Brien $92 million
3. FXCM $75 million
4. GFT $69 million
5. Gain Capital $50 million
6. I Trade FX $34 million

Below $20 Million
7. PFG $19.7 million
8. Interbank FX $19.2 million
9. FX Solutions $17.9 million
10. IFX $15.5 million
11. CMS $13.8 million
12. GFS Futures & Forex $10.2 million
13. CMC $8.7 million
14. Alpari $8 million
15. Ikon $7.9 million
16. Easy Forex $7.6 million
17. Friedberg Mercantile $7.5 million
18. Forex Club $7.4 million
19. MB Trading $7 million
20. ODL $6.9 million
21. Hotspot $6.1 million
22. Money Garden $6 million
23. Bacera $5.4 million
24. Advanced Markets $5.2 million

[forex savior]

Been doing well trading recently so I haven't had much time to post (gotta love volatility!)

In any case the shysters are busy as ever out there so beware. Forex Fraud is happening all over the world. The trading public really needs to be careful about who they trade with. Again, I recommend sticking with firms that are regulated, have good track records and have a healthy capital number. Above all I STRONGLY recommend that you not trade with a firm that is unregulated.

All the crooks busted below were unregulated rogues (especially Zimbabwe's dictator Robert Mugabe. lol.) As a guide it should be noted the following firms are not regulated and as a customer you have no rights in a dispute or if the firm gets into trouble and goes bankrupt:

Unregulated Brokers
Finex
Tradex Swiss AG
ACM
WestCapFX
MIG
DukasCopy
GFX Group (Forex.CH)
Crown Forex
GCI
Northfinance
FXDD

NYC Man Sentenced in Forex Scam
NYC Man Sentenced in Forex Scam - AP - National Business News - Portfolio.com
Feb 15 2008 3:13PM EST

A New York man was sentenced to more than 12 years in prison Friday in connection with a foreign currency exchange scam that bilked more than 200 investors out of $6.5 million.

The U.S. Attorney's office in Manhattan said Boris Shuster, also known as "Robert Shuster," was sentenced to 150 months in prison at a hearing in U..S. District Court in Manhattan.

U.S. District Judge Victor Marrero also ordered Shuster to forfeit $7.89 million and pay a $10,000 fine.

Shuster,guiltyleaded guilty to conspiracy, 14 counts of wire fraud and 13 counts of mail fraud last June. Prosecutors had sought a sentence of 235 months to 293 months in prison, said Sarita Kedia, Shuster's lawyer.

"We do plan to appeal," Kedia said.

Shuster was previously sentenced to 60 months in prison after pleading guilty to criminal charges in a separate forex scam in federal court in Brooklyn. He had remained free pending his sentencing in federal court in Manhattan, Kedia said.

In the Manhattan case, prosecutors had alleged that Shuster and Alexander Dzedets operated a fraudulent forex firm named Holston, Young, Parker & Associates in Manhattan. Dzedets, 32, and nine others have pleaded guilty to criminal charges in the "boiler room" scheme, prosecutors said.

Employees of the firm allegedly used false and misleading sales pitches and high-pressure sales tactics to convince people to invest in its purported forex trading program, the government said.

Funds raised weren't used to invest in the forex market, but were instead diverted to bank accounts in Cyprus and Russia, prosecutors said.

NAB arrests forex fraud accused - DAWN NAB arrests forex fraud accused - DAWN « Aaj TV News | Aaj News | Aaj TV | Aaj

The Punjab chapter of the National Accountability Bureau has arrested Kashif Iqbal, business partner of M/s SKAF International, Lahore, on charges of fraud, misappropriation and cheating public.
According to a NAB press release, M/s SKAF International was involved in illegal forex business in 2003. Kashif along with three business partners fraudulently induced public at large to invest their money on false promises of profit up to four per cent to five per cent per month. They cheated 68 people, obtained deposits from them and misappropriated an amount of Rs29.308 million.

A reference against the accused had already been filed with the accountability court in 2007. After arrest, Kashif was produced in the accountability court and sent to judicial lockup.

Forex Scam Haunts MugabeForex scam haunts Mugabe : Mail & Guardian Online

President Robert Mugabe’s fight against corruption is closing in on his closest confidants. The 82-year-old leader is in a quandary and is unwilling to pass a routine political directive for the arrest and prosecution of Zanu-PF officials allegedly involved in illegal foreign currency dealings.

Police insiders have said that no arrest or prosecution of a Cabinet minister or member of Zanu-PF’s Politburo takes place without Mugabe’s sanction. It is a political formality that the police and Attorney General adhere to, but Mugabe’s selective approach has irked some of his colleagues in Cabinet.

The police’s criminal investigations department investigated Mugabe’s close ally, retired General Solomon Mujuru, husband of Vice-President Joice Mujuru, for flouting exchange control regulations and running Mafia-type shelf companies.

These companies would buy and trade foreign currency on the black market with individuals and companies in which the government has an interest. Mujuru then made weekly transfers involving billions of Zim dollars (see “The docket”).

[bizbad]

Just wondering if there has been any news on the possibility of the 20 million dollar law passing? My broker is below the level.

[forex savior]

And with the Congress set to raise minimum capital requirements for forex dealers to $20 million these numbers are once again taking on greater significance.

Above $20 Million
Oanda $157 Million
RJ O'Brien $91 million
FXCM $82 million
GFT Forex $76 million
Gain Capital $50 million
I Trade FX $33 million
Interbank FX $23 million

Below $20 Million
PFG $18.6 million
FX Solutions $17.3 million
CMS $13.3 million
ODL $11.9 million
GFS Forex $10.4
IFX $9.3 million
CMC $8.7 million
Alpari $8 million
Ikon $7.9 million
Easy Forex $7.7 million
Hotspot $7.7 million
MB Trading $7.6 million
Friedberg Mercantile $7.5 million
Forex Club $7.4 million
Money Garden $6.3 million
Bacera $5.3 million
Advanced Markets $5.2 million

Financial Data for FCMs

[forex savior]

Originally Posted by bizbad

Just wondering if there has been any news on the possibility of the 20 million dollar law passing? My broker is below the level.

It looks like it is going to happen. From what I'm reading it is a done deal.

[VulcanClassic]

Any idea when the deadline is?

[forex savior]

Originally Posted by VulcanClassic

Any idea when the deadline is?

Gotta pass the Congress first

[forex savior]

I have been hearing a lot about FXDD and people have been asking me about their regulatory status. So what's the scoop?

FX Direct Dealer is a New York City based broker located in Manhattan . FXDD used to be affiliated with Tradition Securities. However, today Tradition only owns a small percentage of the firm. Thus FXDD is in no position to claim Tradition as a parent company for regulatory purposes.

So aren’t they then required to register according to the law? Not according to FXDD. Here is a response I got from a customer service rep over at FXDD when I asked them this question on their chat:

Forex Inquiries: FXDD began as a subsidiary of Tradition North America within the Tradition Group of companies. (http://www.traditiongroup.com/uk/home3.asp). FXDD's management, operation, compliance, customer relations and its financial policies and procedures were structured to meet the Tradition Group's oversight and those policies and procedures remain firmly in place. Our managers have deep experience in the foreign exchange markets and we conduct our business as highly qualified professionals. As yet, the OTC spot forex market in the United States is not subject to regulation by the SEC or the CFTC. FXDD is not a member of any private self regulatory organization such as the FINRA or the NFA and is not registered with either the CFTC or the SEC. Congress is considering legislation that will require all forex dealers to register, probably with the CFTC and join NFA as it is the only recognized private futures regulatory authority. So,as the regulatory environment for spot foreign exchange changes, FXDD will keep its options open and, if congress passes new legislation, FXDD will register with the designated oversight agencies. Having said that, FXDD manages its business in conformity with well established dealing protocols and the customs and practices of the foreign exchange dealing community. FXDD has thousands of clients who have chosen us as their dealing firm because of the manner in which we conduct our business and because of our historic association with the Tradition Group. We maintain extensive dealing lines with the top global banks and have never had any issues relating to the protection of customer assets or the manner in which we handle our client accounts.

Uh, someone should let FXDD Know that OTC spot forex IS regulated in the United States and they ARE subject to regulation by the CFTC.

I have put the question to FXDD by email but have yet to get a response. Customers need to be aware that this firm is swimming in some very murky regulatory waters. The CFTC could crash through FXDD’s door at any moment and demand the firm shut down their business because they are not regulated. Every retail forex dealer in the United States has accepted the CFTC as their regulator but FXDD is claiming they have no jurisdiction? This firm in my opinion is a very risky place to put your money. Buyer Beware.