Without exception, Australian forex brokers have been refusing, for several years now, to accept American clients – not because of regulations originating with their regulator (the ASIC), but because of regulations originating with our regulator (the CFTC).
Meanwhile however, ASIC regulations have, until now, allowed Australian brokers to host foreign clients from many other countries, including notably China.
This laissez-faire attitude on the part of the ASIC toward foreign clients (from countries other than the US) made Australian brokerage business licenses especially prized among foreign brokers looking for access to a worldwide market. Accordingly, several foreign brokers have in the recent past set up shop in Australia specifically to take advantage of a sensibly-regulated environment from which they could on-board clients from around the world.
As noted previously in another thread, leniency on the part of the ASIC is ending, and that agency is now seen to be falling into line with regulators in the US, the UK, the EU, and Canada.
Our own CFTC in 2010 began all this Nanny State control over the free choice of ordinary traders.
Here’s an update on the evolving regulatory situation in Australia, published in Finance Magnates –
Excerpts from the article –
IFGM is the first broker in Australia to begin closing accounts of select clients it on-boarded from overseas. The company started informing its customers from outside of Australia that it will be returning their client funds held with the brokerage.
While the debate is likely to continue over the coming months, IFGM (which is one company heavily reliant on Chinese clients, as many other local brokers are) decided to restructure its operations.
…at least two companies have shared with Finance Magnates that they are considering to offer to their overseas customers a service regulated in an offshore jurisdiction.
The best possible outcome for us, as U.S. resident traders, would be for a strong, reputable Australian broker to set up an offshore subsidiary in a jurisdiction which welcomes clients from everywhere, including the USA.
We needn’t be afraid of a reputable broker domiciled in a weak jurisdiction. As we know from our experience over almost 9 years in this thread, the honesty and reliability of a broker is more important than the strength of that broker’s regulator.
Doctors Without Borders was the inspiration for this graphic –