The CFTC is alleging that InstaForex has been doing business in the U.S., by virtue of the fact that they have at least one Introducing Broker in the U.S. feeding business to them.
And the CFTC claims that the Dodd-Frank law, and the CFTC regulations created to implement the Dodd-Frank law, require any broker doing business in the U.S. to be registered with the CFTC.
And, finally, they claim that InstaForex was not registered, as required.
If all of that is true, then InstaForex apparently is (or has been) in violation of CFTC regs.
InstaForex can probably sit safely in the BVI, and thumb their nose at the CFTC. And I hope they do.
But, itâs probably a different matter altogether for their IB in Connecticut, and for their websites hosted on servers located in the U.S. The IB is probably in big trouble, and the websites have already been shut down.
In the future, InstaForex could probably accept U.S. customers (without worrying about the CFTC), while operating strictly from the BVI, without any U.S. introducing brokers or other U.S. presence.
But, for right now, it probably makes sense for InstaForex to say, Screw all you Americans.
We may say it but they have really screw us. I went to the Orlando Money Show as we are a retirement program and look for different ways to diversify our holdings. Last year there were several forex program dealers and brokers at the Money Show. The CFTC also had a booth there as well. This year, there was not one broker or forex anything and the CFTC didnât show up either. What a difference a year makes and a couple of traitors in congress.
Clint, since youâre the one keeping a close eye on this CFTC litigation, Iâm wondering if you have any insight as to how the CFTC is going after foreign brokers with no presence in the United States. Who, exactly, are they serving, and by what supposed right are they going after companies outside the USâs jurisdiction?
Well, I have to slice-and-dice your post, in order to answer you:
Actually, Iâm watching it unfold the same way you are. I have no special insight into this matter. In fact, I learned about the CFTCâs current suit on this thread. And I was alerted to the .pdf of their court filing on this thread, as well.
My answer to fxmasters question (3 posts ago) was just my recap of the highlighted portions of that .pdf.
I do not. If the CFTC does, in fact, go after one of more offshore brokers who have NO presence in the U.S., that will be a major escalation in their war on retail forex.
I only know what has already been posted on this thread, and what I have read on the CFTC website.
Thatâs the biggest question of all. Clearly, the CFTC has NO rights where they have no jurisdiction. Foreign regulatory agencies should tell the CFTC to mind their own damn business.
Obviously, the CFTC is completely out of control. They have run amok. Their chairman is a little, tin-horn dictator, who is full of himself, and believes he has god-like powers to meddle in things which are clearly outside his jurisdiction, and beyond his mandate. Itâs time for Congress to yank his leash.
And itâs time for Congress to gut the Dodd-Frank bill, or better yet, repeal the whole thing. Chris Dodd and Barney Frank bear more responsibility for the derivatives abuses which caused the current financial crisis, than any other individuals on the planet. To put those two reprobates in charge of writing a bill to fix the mess they created is an obscenity. Dodd and Frank should be in jail â not writing bills in Congress.
That is the best written response I have seen yet. I know a few who specialize in constitutional law, and are also traders⌠Ill forward this to them looking for a response.
Iâve talked with several offshore brokers. If you ever want to get some good insight to how things are being handle with CFTC and offshore brokers talk to Mike at MIG. MIG is based out of Switzerland. Mike lives there but is originally from Texas he is on their U.S.A Team or as they call it âTeam USAâ
I was asking him about Offshore brokers and the CFTC and why some donâtâ accept U.S accounts that arenât even regulated by CFTC. He said part of the reason Offshore brokers arenât accepting U.S accounts is because they are trying to âplay niceâ with the CFTC. (Perhaps the U.S & CFTC have a lot of pull internationally?) and he said the CFTC is like the âCOPSâ of the Forex and no one wants to piss them off. He said that is why some offshore brokers do no offer higher leverage etcâŚfor U.S accounts even though they could, because they do not want draw too much attention from CFTC or The âCOPSâ InterestingâŚ
I figured as much but thank you for the confirmation, fxmasters. These bullying tactics by the US government of foreign governments and corporations contributes to a lot of ill will against the United States internationally. The CFTC has no business telling foreign brokers with no US presence what to do, and it has no business prohibiting US citizens from holding accounts overseas. Most of all, the CFTC has no legal right to impose its will on foreign countries or firms.
The US is not the super-government of the world and needs to stop acting as if it is. Unfortunately, the US government has become accustomed to bullying the rest of the world to get what it wants, and in this case American forex traders are suffering as a result. Based on my understanding, a lot of foreign banks wonât open accounts for US customers now for the same general reason - regulatory overreach by the US.
Vantage FX in Australia IS accepting new U.S. clients. I submitted an application (from Wisconsin) and received both a phone call and email verifying my account.
Forex FS in Australia is also accepting new U.S. clients. Get Money FX is NOT.
They have no presence in the US whatsoever, unlike those firms that got sued: no US-based IBs, no servers, no soliciting websites, no telephone numbers, no representative offices - nothing, nill, nada. Makes me wonder what the US CFTC can do to them.
Well, I signed up with vantage FxâŚweâll see. In light of all these government crackdowns, Iâm going to start the process of at least getting a foreign bank account. Then weâll see where that leads.
shaun