Whats your view on the big FX brokers, $20 mill cap+
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Alain Broyon, CEO of Dukascopy, in this interview said:
"Dukascopy is currently undergoing licensing process to become a Swiss bank. At the same time we are continuing to work on our technology to insure that Dukascopy - SWFX remains a unique marketplace solution. We are targeting a daily volume of 100 billion USD, approximately 10% of the World’s spot market."
The complete interview http://www.forexpros.com/brokers/dukascopy/interviews
"Dukascopy is currently undergoing licensing process to become a Swiss bank. At the same time we are continuing to work on our technology to insure that Dukascopy - SWFX remains a unique marketplace solution. We are targeting a daily volume of 100 billion USD, approximately 10% of the World’s spot market."
The complete interview http://www.forexpros.com/brokers/dukascopy/interviews
DislikedOh yes you're right they have not replied or your email got lost so it automatically means they refused to comment.
You seem to think that an email is the best way to get official and reliable information, to then be able to post it on 34 different Forex forums. Especially since the customer service rep working at 6$/hr will surely have first hand and accurate details about the decision his broker took regarding the situation.
At the price you're getting paid for your scare tactics campaign I think you could do a bit better in terms of research...Ignored
DislikedWow that is tough. You must have been burned bad to take it to this level.
Whats your view on the big FX brokers, $20 mill cap+Ignored
What really burns me up about this Aleccoh guy at the Forex TSD thread is his out and out lies about how his firm was supposedly regulated. A customer asked him specifically in December of 2007 if his company was regulated and asked him if he had a registration number. Mr. Aleccoh stated, “Aleccohfx SA is regulated and run according to the Swiss law under OAR-G Swiss Regulation Official Body Funded by GSCGI.” As I have demonstrated on this thread numerous times OAR-G, ARIF, etc does not mean jack squat in terms of forex regulation. Those are mere certifications stating the firm will abide by Swiss money laundering laws. That’s it! It is not legit “regulation” and traditionally there has been no regulatory agency checking in on these brokers (hence the reason these brokers all now have to get a bank license or close.) These Swiss brokers know that but they continue to lie to the public and claim they are regulated WHEN THEY CLEARLY ARE NOT.
When another trader calls him out on this “Aleccoh” claims, no OAR-G is just like the NFA. He also went on to say that Aleccoh FX would be applying for a banking license. Then shortly after that claimed he didn’t need to get a banking license since the new law in Switzerland only applied to “liquidity providers” and not retail brokers.
Then it all hits the fan and he states, “I am not in charge anymore of aleccohfx because of the fact that the new Swiss regulations forbid me to be in charge or any of my team since we are traders and that it is forbidden to be traders and brokers.” He then claimed to be applying for registration with the NFA in the United States …
Reading through this thread is maddening. You simply can’t trust a single word that comes out of the mouths of these Swiss Forex Dealers. And don’t think this is an aberration. Every Swiss broker has been lying to the public about their regulatory status. DukasCopy, MIG, ACM have all been bamboozling traders about their regulatory status claiming their membership in limp wristed organizations like “ARIF” were somehow the equivalent of being regulated by regulatory agencies like the FSA and NFA.
But the fact is as it stands today none of these firms have real registrations with a real regulatory body. Not ACM. Not DukasCopy. Not MIG. Until they actually GET a banking license don’t put money on deposit with them. They have not been straight with the public and as the Aleccoh FX scam proves a broker’s words don’t mean squat unless they are backed up by the rule of law.
When another trader calls him out on this “Aleccoh” claims, no OAR-G is just like the NFA. He also went on to say that Aleccoh FX would be applying for a banking license. Then shortly after that claimed he didn’t need to get a banking license since the new law in Switzerland only applied to “liquidity providers” and not retail brokers.
Then it all hits the fan and he states, “I am not in charge anymore of aleccohfx because of the fact that the new Swiss regulations forbid me to be in charge or any of my team since we are traders and that it is forbidden to be traders and brokers.” He then claimed to be applying for registration with the NFA in the United States …
Reading through this thread is maddening. You simply can’t trust a single word that comes out of the mouths of these Swiss Forex Dealers. And don’t think this is an aberration. Every Swiss broker has been lying to the public about their regulatory status. DukasCopy, MIG, ACM have all been bamboozling traders about their regulatory status claiming their membership in limp wristed organizations like “ARIF” were somehow the equivalent of being regulated by regulatory agencies like the FSA and NFA.
But the fact is as it stands today none of these firms have real registrations with a real regulatory body. Not ACM. Not DukasCopy. Not MIG. Until they actually GET a banking license don’t put money on deposit with them. They have not been straight with the public and as the Aleccoh FX scam proves a broker’s words don’t mean squat unless they are backed up by the rule of law.
As I have illustrated on this thread there is no shortage of colorful con artists in the forex business. Yet there is one criminal mastermind in particular who always seems to skate away from his on ice thuggery with more dexterity than one of the Hanson Brothers. His name is Robert Gray. And when he wields the high stick more than just a few teeth go flying into the blood splattered night...
So who is this guy? How has he been able to cut such a swath through the forex industry for all these years? And how was he able to con, not just ordinary traders, but top U.S. Regulatory Agencies themselves? Well, he was able to do it using that old American adage that "Practice makes Perfect."
The Rob Gray story starts back in the go go 80's on that notorious stretch of highway running from Boca Raton to Miami known to the Feds as "Maggot Mile." It was December 11, 1986, when our goodfella to be got started in the futures industry by applying to be an associate member of the NFA with the firm Multivest Options Inc and International Precious Metals Corp Inc in Fort Lauderdale.
http://www.nfa.futures.org/basicnet/...d=0196740&rn=Y
But Gray's career with these two firms would be short lived and by the summer of 1987 he was no longer licensed by the NFA and had apparently left these brokerages. Multivest itself would eventually be closed down for gross fraud within a few years.
Let's role the tape and see how Gray got his start as a forex huckster:
Multivest Options Inc was one of the many futures industry orifices oozing with criminality during the decade of greed. The firm all by itself had over 120 Reparations Cases with the CFTC.
http://www.nfa.futures.org/BasicNet/...tityid=0001646
In 1988 the NFA settled a case with Multivest in which numerous salesmen were cited for fraud and high pressure sales tactics. http://www.nfa.futures.org/BasicNet/...0&contrib=CFTC
And then in 1990 the CFTC shut them down for good stating:
http://www.nfa.futures.org/BasicNet/...0&contrib=CFTC
So this is the firm that gave birth to Robert Gray, a fraudulent futures firm that sold bogus options to the gullible Senior Citizens of Seizure World, USA.
The trail goes cold in the 1990's although rumor has it he gravitated over to the stock market (I can't imagine Gray missed out on the greatest con off them all, the Internet Stock Bubble...) But his grand debut in the forex world appears to be in 2000 at FXCM of all places. According to a hilarious story I picked up at the New York Traders Expo a couple months ago Gray was the head of sales at FXCM and in a feat of treachery worthy of an Italian Opera he bolted the company with all FXCM's clients on a floppy disk and went to work at FX Solutions! Well done Rob, Lord Vader from MultiVest trained you well...
But it appears FX Solutions was not all the grateful as he lasted all of three months in their employ according to the NFA's Registration Records.
http://www.nfa.futures.org/basicnet/...d=0196740&rn=Y
Where to next for this Son of the Sith? Well, how about Director of Global Forex Operations for GFS Forex & Futures. Good Lord, how on earth did Robert Gray land this gig? Doesn't ANYONE do background checks anymore? Apparently not. Check out this article from 2003 which discusses the growing popularity of mini trading in FX:
http://www.allbusiness.com/specialty.../565252-1.html
Ok for Robert Gray of all people to speak glowingly about the "regulatory environment" for forex is to redefine the meaning of "Chutzpah." Call it "Grayzpah." And how about this for Grayzpah. In this lawsuit filed by the State of Colorado in 2004 Robert Gray is listed as a "Compliance Officer" with GFS. What on earth does Robert Gray know about compliance?That's the equivalent of having Michael Jackson as your babysitter.
http://www.dora.state.co.us/securities/pdf_forms/xlcapital%20receiver's%201st%20int%20rpt.pdf.
Another interesting note from this lawsuit is the admission that GFS cleared all its trades through Interbank FX. Which brings us to Part II of Dirty Rotten Scoundrel, stay tuned...
So who is this guy? How has he been able to cut such a swath through the forex industry for all these years? And how was he able to con, not just ordinary traders, but top U.S. Regulatory Agencies themselves? Well, he was able to do it using that old American adage that "Practice makes Perfect."
The Rob Gray story starts back in the go go 80's on that notorious stretch of highway running from Boca Raton to Miami known to the Feds as "Maggot Mile." It was December 11, 1986, when our goodfella to be got started in the futures industry by applying to be an associate member of the NFA with the firm Multivest Options Inc and International Precious Metals Corp Inc in Fort Lauderdale.
http://www.nfa.futures.org/basicnet/...d=0196740&rn=Y
But Gray's career with these two firms would be short lived and by the summer of 1987 he was no longer licensed by the NFA and had apparently left these brokerages. Multivest itself would eventually be closed down for gross fraud within a few years.
Let's role the tape and see how Gray got his start as a forex huckster:
Multivest Options Inc was one of the many futures industry orifices oozing with criminality during the decade of greed. The firm all by itself had over 120 Reparations Cases with the CFTC.
http://www.nfa.futures.org/BasicNet/...tityid=0001646
In 1988 the NFA settled a case with Multivest in which numerous salesmen were cited for fraud and high pressure sales tactics. http://www.nfa.futures.org/BasicNet/...0&contrib=CFTC
And then in 1990 the CFTC shut them down for good stating:
http://www.nfa.futures.org/BasicNet/...0&contrib=CFTC
QuoteDisliked"from June 1987 through October 1989, MultiVest, while soliciting almost 15,000 customers to invest in commodity options, misrepresented the likelihood of profit in trading commodity options, MultiVest's success rate, the risks in trading commodity options, the expertise and experience of MultiVest's sales people, and the extent and quality of MultiVest's market research. MultiVest was also charged with failing to supervise the handling of commodity options accounts by its salespeople."
So this is the firm that gave birth to Robert Gray, a fraudulent futures firm that sold bogus options to the gullible Senior Citizens of Seizure World, USA.
The trail goes cold in the 1990's although rumor has it he gravitated over to the stock market (I can't imagine Gray missed out on the greatest con off them all, the Internet Stock Bubble...) But his grand debut in the forex world appears to be in 2000 at FXCM of all places. According to a hilarious story I picked up at the New York Traders Expo a couple months ago Gray was the head of sales at FXCM and in a feat of treachery worthy of an Italian Opera he bolted the company with all FXCM's clients on a floppy disk and went to work at FX Solutions! Well done Rob, Lord Vader from MultiVest trained you well...
But it appears FX Solutions was not all the grateful as he lasted all of three months in their employ according to the NFA's Registration Records.
http://www.nfa.futures.org/basicnet/...d=0196740&rn=Y
Where to next for this Son of the Sith? Well, how about Director of Global Forex Operations for GFS Forex & Futures. Good Lord, how on earth did Robert Gray land this gig? Doesn't ANYONE do background checks anymore? Apparently not. Check out this article from 2003 which discusses the growing popularity of mini trading in FX:
http://www.allbusiness.com/specialty.../565252-1.html
QuoteDislikedGFS Securities & Futures got on board a few months ago in March. "It was very much a client-driven decision," says Robert Gray, director of global forex operations for GFS. "The regulatory environment that the markets exist in now is really fueling forex in general."
Ok for Robert Gray of all people to speak glowingly about the "regulatory environment" for forex is to redefine the meaning of "Chutzpah." Call it "Grayzpah." And how about this for Grayzpah. In this lawsuit filed by the State of Colorado in 2004 Robert Gray is listed as a "Compliance Officer" with GFS. What on earth does Robert Gray know about compliance?That's the equivalent of having Michael Jackson as your babysitter.
http://www.dora.state.co.us/securities/pdf_forms/xlcapital%20receiver's%201st%20int%20rpt.pdf.
Another interesting note from this lawsuit is the admission that GFS cleared all its trades through Interbank FX. Which brings us to Part II of Dirty Rotten Scoundrel, stay tuned...
- #706
- Apr 21, 2008 11:57am Apr 21, 2008 11:57am
Here at one of the forex firms, it's interesting to see how much attention is paid to the net cap. It's certainly an important number. However, I would say that maybe one out of every twenty clients that I talk to have any idea what it means. They hear that there's a net cap number, and they read somewhere that "bigger is better", and that's when I get a phone call.
I'm not going to read through this whole entire thread (48 pages - wow - and the first few were very amusing), but I read several pages into it to get an idea of what people fear, what people think it means, and what people believe a firm should have. There is nothing worse than having to answer a net cap question where the person is totally mistaken about what the number means, because no matter how right I am about what it means, they'll view it as me trying to be evasive.
The 20 mill is still up in the air because farm bill negotiations are all over the place, but it'll be interesting to see the consolidation after that point.
I'm not going to read through this whole entire thread (48 pages - wow - and the first few were very amusing), but I read several pages into it to get an idea of what people fear, what people think it means, and what people believe a firm should have. There is nothing worse than having to answer a net cap question where the person is totally mistaken about what the number means, because no matter how right I am about what it means, they'll view it as me trying to be evasive.
The 20 mill is still up in the air because farm bill negotiations are all over the place, but it'll be interesting to see the consolidation after that point.
I know its another forum, but you need to read what his guy said, cause it does make a lot of sense, and I dont want to take any credit for it.
http://elitetrader.com/vb/showthread...6&pagenumber=6
http://elitetrader.com/vb/showthread...6&pagenumber=6
- #709
- Apr 23, 2008 9:37am Apr 23, 2008 9:37am
I can't really comment on that posting... a lot of it makes sense, but other parts don't.
The thing about Net Cap is that its (roughly) like a savings account for the firm. It's excess money above what you're required to have. The NFA is constantly looking at the numbers the firm reports. A lower net cap number doesn't mean you can't meet your obligations. For example, if you have an expense come up - you pay it, and you take a net cap hit. The next month, the amount could come back up, or it might not. There's no magic number that says "I'm safe, I'm good" (beyond minimums that you are required to have). Obviously, it's better to have more in savings - a person with 7 million dollars in savings is doing better than the guy with 7 dollars in savings. But it doesn't mean that the guy with 7 dollars in savings is necessarily in trouble. Maybe the guy with 7 dollars in savings uses excess earnings elsewhere to improve other parts of his work or life. Maybe he had a doctor bill that had to be paid. Maybe he just spent it on frivolous stuff. It seems like a lot of people on here just assume that the guy did the last part - that he spent the money frivolously. Firms in forex work in the same way - net cap changes don't necessarily mean your money is more or less safe, and it doesn't mean that if the firm jumps up in net cap that it became a better firm. It *could* mean those things, but we shouldn't just jump to conclusions.
Ultimately, more changes are coming, and we'll see firms jump up and down, and more reporting will happen. New forex "products" will arrive, and some companies will adapt, and some won't. Pay attention to net cap, but don't overdo it either. Learn how the net cap figure is calculated (it's available in the NFA's FCM guide online) and make yourself better informed on the number.
The thing about Net Cap is that its (roughly) like a savings account for the firm. It's excess money above what you're required to have. The NFA is constantly looking at the numbers the firm reports. A lower net cap number doesn't mean you can't meet your obligations. For example, if you have an expense come up - you pay it, and you take a net cap hit. The next month, the amount could come back up, or it might not. There's no magic number that says "I'm safe, I'm good" (beyond minimums that you are required to have). Obviously, it's better to have more in savings - a person with 7 million dollars in savings is doing better than the guy with 7 dollars in savings. But it doesn't mean that the guy with 7 dollars in savings is necessarily in trouble. Maybe the guy with 7 dollars in savings uses excess earnings elsewhere to improve other parts of his work or life. Maybe he had a doctor bill that had to be paid. Maybe he just spent it on frivolous stuff. It seems like a lot of people on here just assume that the guy did the last part - that he spent the money frivolously. Firms in forex work in the same way - net cap changes don't necessarily mean your money is more or less safe, and it doesn't mean that if the firm jumps up in net cap that it became a better firm. It *could* mean those things, but we shouldn't just jump to conclusions.
Ultimately, more changes are coming, and we'll see firms jump up and down, and more reporting will happen. New forex "products" will arrive, and some companies will adapt, and some won't. Pay attention to net cap, but don't overdo it either. Learn how the net cap figure is calculated (it's available in the NFA's FCM guide online) and make yourself better informed on the number.
When last we left off Robert Gray was busy handing over the financial records of a shady managed funds firm operating under his nose at GFS to government prosecutors. As the court document described GFS was clearing its trades through Interbank FX.
The marriage between Gray and IBFX then became fully consummated in 2005. In March of that year according to the NFA Gray applied to be a Principal with Interbank FX. No telling if he ran over to IBFX with all GFS' clients but in any case he appears to have officially stayed at IBFX for about six months.
Unofficially? This is where things get very murky. Gray withdrew his license with IBFX on October 1, 2005 and applied for a new one with a newly created FCM, Forex Liquidity, on October 28, 2005. It was at FXLQ where Gray would cook up his piece de resistance, concocting an imaginary $35 million bond out of thin air and using that to pad FXLQ's official adjusted net capital number.
I won't rehash the collapse of FXLQ again but if you would like a full recap feel free to go here:
http://www.fxstreet.com/forum/showpo...2&postcount=95
While Gray officially cut his ties to IBFX in 2005 there was still a business relationship between the two as evidenced by the fact that FXLQ was a prime provider of liquidity to IBFX. A debate has risen on the bulletin boards as to how dependent IBFX was on FXLQ in providing it with liquidity. In particular one dubious poster on FX Street claims IBFX for a long time was merely a white label of FXLQ and was somehow bound to Robert Gray for life:
http://weblog.fxstreet.com/2007/12/interbankfx-rel.html
The white label charge comes off as a bit of conspiracy mongering on the part of this Dan Campbell as IBFX continues to operate for the most part without incident even as FXLQ has been shut down. But it does beg the question how on earth did Robert Gray accrue so much influence in this industry?
Gray has been linked to numerous firms from FXDD, to Spencer Financial to Velocity FX. Google him and his name appears all over the bulletin boards like a plague bacillus.
http://www.elitetrader.com/vb/showth...5753&highlight
http://forexbastards.com/forum/inde...96&min=0&num=15
http://www.moneytec.com/forums/f33/f...ad.php?t=44998
So deep is his influence that he even pops up in China heading up another fx brokerage called MultiBank FX (great mugshot of Gary on page 7):
http://www.fxmultibank.com/pdf/brochure.pdf
And while IBFX may still be up and running their relationship with Robert Gray has cost them dearly as FXLQ owes Interbank over $10 million in frozen assets according to FXLQ's own Receiver:
http://www.robbevans.com/pdf/forexlqreport01.pdf
It's my hope that the new NFA Capital Requirement increase to $5 million will help weed out the Robert Grays of the FX World. Gray flourished in the weeds of the industry at small firms that never seemed to get the NFA's attention. But with the industry reduced to 24 domestic firms and with new rules set to require all Introducing Brokers be licensed his time will have come and gone and none too soon.
I read at one of these links that Robert Gray has an Irish passport and that if things ever get too rough he can always hop on Aer Lingus and live out his days shepherding sheep on a quiet farm outside Galway. Well, should that day come I'm sure the forex trading community will sing in unison:
Oh Robbie Boy, the pipes, the pipes are calling
From glen to glen, and down the mountainside.
The summer's gone, and all the flowers are dying.
'Tis you, 'tis you must go and we gladly say goodbye.
But come ye not back when summer's in the meadow
Or when the valley's hushed and white with snow,
'Tis we'll dread you be there in sunshine or in shadow.
Oh Robbie Boy, Oh Robbie Boy, we loathe you so...
The marriage between Gray and IBFX then became fully consummated in 2005. In March of that year according to the NFA Gray applied to be a Principal with Interbank FX. No telling if he ran over to IBFX with all GFS' clients but in any case he appears to have officially stayed at IBFX for about six months.
Unofficially? This is where things get very murky. Gray withdrew his license with IBFX on October 1, 2005 and applied for a new one with a newly created FCM, Forex Liquidity, on October 28, 2005. It was at FXLQ where Gray would cook up his piece de resistance, concocting an imaginary $35 million bond out of thin air and using that to pad FXLQ's official adjusted net capital number.
I won't rehash the collapse of FXLQ again but if you would like a full recap feel free to go here:
http://www.fxstreet.com/forum/showpo...2&postcount=95
While Gray officially cut his ties to IBFX in 2005 there was still a business relationship between the two as evidenced by the fact that FXLQ was a prime provider of liquidity to IBFX. A debate has risen on the bulletin boards as to how dependent IBFX was on FXLQ in providing it with liquidity. In particular one dubious poster on FX Street claims IBFX for a long time was merely a white label of FXLQ and was somehow bound to Robert Gray for life:
http://weblog.fxstreet.com/2007/12/interbankfx-rel.html
QuoteDislikedFrom: Dan Campbell, Pipland, USA
Date of Post: 2007-12-05
Review: I've been trying to warn folks for over 2 years now (read my threads below, I used to work there), but justice is finally being servered, "to some degree". Forex Liquidity (FXLQ) is finally under investigation from the NFA. To recap: InterbankFX (IBFX) is a white label of FXLQ. Hense they are able to say "no dealing desk". Because in fact "IBFX" does not have a dealing, but rather it's at FXLQ where all IBFX customers clear their trades...
Sadly, as with most NFA "investigations", nothing will be done, but this should be a hugh warning bell for everyone using IBFX. Following the bread crumbs folks...
http://www.nfa.futures.org/basicnet/...d=0362216&rn=Y
http://www.nfa.futures.org/basicnet/...13&contrib=NFA
http://www.fxlq.com/
The white label charge comes off as a bit of conspiracy mongering on the part of this Dan Campbell as IBFX continues to operate for the most part without incident even as FXLQ has been shut down. But it does beg the question how on earth did Robert Gray accrue so much influence in this industry?
Gray has been linked to numerous firms from FXDD, to Spencer Financial to Velocity FX. Google him and his name appears all over the bulletin boards like a plague bacillus.
http://www.elitetrader.com/vb/showth...5753&highlight
http://forexbastards.com/forum/inde...96&min=0&num=15
http://www.moneytec.com/forums/f33/f...ad.php?t=44998
So deep is his influence that he even pops up in China heading up another fx brokerage called MultiBank FX (great mugshot of Gary on page 7):
http://www.fxmultibank.com/pdf/brochure.pdf
And while IBFX may still be up and running their relationship with Robert Gray has cost them dearly as FXLQ owes Interbank over $10 million in frozen assets according to FXLQ's own Receiver:
http://www.robbevans.com/pdf/forexlqreport01.pdf
It's my hope that the new NFA Capital Requirement increase to $5 million will help weed out the Robert Grays of the FX World. Gray flourished in the weeds of the industry at small firms that never seemed to get the NFA's attention. But with the industry reduced to 24 domestic firms and with new rules set to require all Introducing Brokers be licensed his time will have come and gone and none too soon.
I read at one of these links that Robert Gray has an Irish passport and that if things ever get too rough he can always hop on Aer Lingus and live out his days shepherding sheep on a quiet farm outside Galway. Well, should that day come I'm sure the forex trading community will sing in unison:
Oh Robbie Boy, the pipes, the pipes are calling
From glen to glen, and down the mountainside.
The summer's gone, and all the flowers are dying.
'Tis you, 'tis you must go and we gladly say goodbye.
But come ye not back when summer's in the meadow
Or when the valley's hushed and white with snow,
'Tis we'll dread you be there in sunshine or in shadow.
Oh Robbie Boy, Oh Robbie Boy, we loathe you so...
There is a great deal of uncertainty in the Swiss Forex Dealer community right now. There is no way of knowing which firms are here to stay and which firms are collecting coins in preparation for their crossing of the river Styx. I have emailed all the major Swiss firms to try and find out if each firm plans on getting a banking license. The responses (or lack thereof) have been quite illuminating.
As such I'm starting a Swiss Dealer Dead Pool to keep the trading public updated and informed about what is going on in Switzerland.
Firms that claim they are applying for a banking license
1) ACM
2) Fibo Group
3) Crown Forex
4) DukasCopy
5) MIGfx
Firms that are fleeing Swiss Regulation
1) Masterforex. Their business office is listed in Switzerland but they are registered in the Seychelles and have stated they do not need to get a banking license.
2) forex-swiss. FXCH, despite the fact they are NAMED "Forex Swiss" claim registration in Dominica. This is an odd company that has claimed multiple office addresses over the years including, Switzerland, Austria, South Africa, Iran, and the United States. Today they are claiming they have offices in Dominica and the United Kingdom. Tomorrow who knows, they could claim a mailing address in Tibet. Beware this firm.
3) Prime4X. Their head office is in Switzerland but they have stated they are applying for a license in Cyprus.
Firms that are no longer accepting customers or have been shutdown
1) WestCapFX
2) Tradex Swiss AG
3) Finex
4) Aleccohfx
Firms that refuse to comment
1) GFX Group (Forex.CH)
2) Swiss Direkt
3) Tadawulfx
4) Advised Trading
As always conduct your due diligence and make sure the firm you trade with is regulated and legit.
As such I'm starting a Swiss Dealer Dead Pool to keep the trading public updated and informed about what is going on in Switzerland.
Firms that claim they are applying for a banking license
1) ACM
2) Fibo Group
3) Crown Forex
4) DukasCopy
5) MIGfx
Firms that are fleeing Swiss Regulation
1) Masterforex. Their business office is listed in Switzerland but they are registered in the Seychelles and have stated they do not need to get a banking license.
2) forex-swiss. FXCH, despite the fact they are NAMED "Forex Swiss" claim registration in Dominica. This is an odd company that has claimed multiple office addresses over the years including, Switzerland, Austria, South Africa, Iran, and the United States. Today they are claiming they have offices in Dominica and the United Kingdom. Tomorrow who knows, they could claim a mailing address in Tibet. Beware this firm.
3) Prime4X. Their head office is in Switzerland but they have stated they are applying for a license in Cyprus.
Firms that are no longer accepting customers or have been shutdown
1) WestCapFX
2) Tradex Swiss AG
3) Finex
4) Aleccohfx
Firms that refuse to comment
1) GFX Group (Forex.CH)
2) Swiss Direkt
3) Tadawulfx
4) Advised Trading
As always conduct your due diligence and make sure the firm you trade with is regulated and legit.
After getting a series of tips from disgruntled traders I'm going to follow up on a couple unregulated forex brokers next week dabbling in the treacherous MT4 arena. Masterforex, PoltekFX and FX Open are involved in a brutal slugfest that has spilled over into numerous bulletin boards. Who are these firms and what are they up to? Details to follow next week.
What happens when a business deal goes bad? You get bitterness, recriminations, machinations and vows to get even. This appears to be what happened after Poltek FX and FX Open parted company. It was not an amicable divorce and after reading through dozens of threads it appears the two former spouses are still hurling dishes, pots and pans, as well as the kitchen sink and family cat at one another in a fit of rage that even Hillary and Obama can’t match.
http://www.forex-tsd.com/metatrader-...-poltekfx.html
In this saga there are no good guys or bad guys. All the Savior can do is warn people to stay on the sidelines and watch the spectacle from afar, well out of harm’s way. But if you are looking for a scorecard, well, you’ve come to the right place. Let’s pick things up from one of the earliest threads on the subject.
“FX Open Scam Scum.” This is the title of a series of truly head spinning threads over at Forex Factory detailing the misadventures of FX Open, a forex dealer with one of the worst reputations in the business.
http://www.forexfactory.com/showthread.php?t=50202
http://www.forexfactory.com/showthread.php?t=50879
http://www.forexfactory.com/showthread.php?t=66136
http://www.forexfactory.com/showthread.php?t=55103
Now if you ask FX Open they blame their poor reputation on the scoundrels at Poltek FX who they claim have been waging a systematic propaganda campaign designed to discredit their firm.
http://fxopen.com/News.aspx?Id=fd4b2...9-d1c48b7015bd
But who is FX Open? Well, nobody really knows. There is no business address listed on their website. There is no Board of Directors or head shots of executive officers. If you really press them they’ll give you an address in Egypt or tell you that they are registered in the Seychelles. And if that isn’t confusing enough one muckraking trader found out that their website is registered in Florida to a “Mr. John Fool.”
http://www.forexfactory.com/showpost...&postcount=101
So they could be anywhere and everywhere. They could be someone or no one. In short, they can up and vanish like a fart in the wind if they have to.
FX Open is also one of the too numerous to count unregulated MT4 brokers preying upon the desperation of those traders who have fallen in love with MetaQuotes’ software. And like so many of these unregulated forex brokers they are in the habit of misleading the public about their unregulated status. When a customer asked them if they were regulated this was their response:
http://www.forex-tsd.com/195190-post316.html
Now let’s go to the SIBA website and find out just what this means. The following are the key features of the law that supposedly “regulates” FX Open:
http://www.siba.net/Pages/siba.htm
• No requirement to disclose the beneficial owners of an IBC
• No minimum capital stipulation
• No need to file accounts with the Registrar
In short, FX Open’s “regulation” consists of a useless piece of paper that probably cost them a $100 in filing fees. They are no more regulated than is some ten year old kid’s lemonade stand.
That alone should convince traders to STAY AWAY from them. But the truth is that’s just the tip of the iceberg with these guys.
FX Open has made a lot of enemies in their brief history. One of them is a Kazakhstan native who goes by the name of Erlan. Erlan was a former customer of FX Open’s and he setup a website completely devoted to getting back $50,000 that he claims FX Open stole from him: http://fxopen.info/
FX Open then responded to Erlan with a website of their own (http://erlan.info/) telling a wild story that included accusations that Erlan was sending all of FX Open’s customers “penis enlargement” emails, was trying to crash FX Open’s server and hack FX Open’s customer files and was actually the customer of a former business partner of FX Open’s (Poltek FX) based in Russia that was using Erlan to get back at FX Open. (More on Erlan and his shenanigans in Part II of Metatrader Misery.)
http://www.forexfactory.com/showpost...6&postcount=13
Now seriously, who in their right mind is going to open an account with FX Open after hearing such a loopy tale? And it gets even zanier. Someone claiming to be FX Open’s CEO starts posting at Forex Factory demanding that the forum moderator stop banning supporters of FX Open or else they’ll sue Forex Factory.
http://www.forexfactory.com/showpost...4&postcount=84
The moderator replies that FX Open is a scam and the man claiming to be FX Open’s CEO quickly slinks out the back door after he sees his threats are being ignored. Indeed, FX Open gets completely banned from the forum and is forced to waddle over to Forex TSD where they cause another huge fight with traders screaming that FX Open is a scam and should be banned.
Is FX Open a scam? It’s just not clear. FX Open’s lack of transparency is deeply troubling. Their communication with the public is so unprofessional and their English so mangled that one gets the impression that Borat is running the company. They are also as I have stated before unregulated so if they ever get into trouble they are accountable to no one. At the end of the day this is what the trading public should be most concerned about.
The public should also be concerned about the firm’s alleged dealing practices. The number one complaint against FX Open is that they are a ruthless market maker that has no patience for customers who actually make money. Now this is a common complaint against many market makers. But in the threads referenced above I’ve never seen so many traders screaming about a firm’s dealing practices. Trader after trader complains about profits being removed from their accounts. Numerous traders complain of how the firm booted them out only after they made profits. Traders complain about terrible execution in numbers that really call into question the dealing ethics of this firm.
FX Open’s reply is that all these complaining customers are using some kind of secret software that allows them to “cheat” and make big profits off them. Thus they have no choice but to close the accounts of these cheating customers. I’m aware that there are some traders out there who are skilled at jumping in and out of the market in short bursts due to price discrepancies and latency issues. But this is very difficult to do. Yet judging from FX Open’s claims you would think that there are hordes of these traders out there raping and pillaging poor little forex dealers like FX Open.
Having said all that are some of these complaints against FX Open being orchestrated by their enemies? It appears so. And in part II of Metatrader Misery we’ll take a look at FX Open’s rival “Poltek FX” to uncover what these guys are up to.
http://www.forex-tsd.com/metatrader-...-poltekfx.html
In this saga there are no good guys or bad guys. All the Savior can do is warn people to stay on the sidelines and watch the spectacle from afar, well out of harm’s way. But if you are looking for a scorecard, well, you’ve come to the right place. Let’s pick things up from one of the earliest threads on the subject.
“FX Open Scam Scum.” This is the title of a series of truly head spinning threads over at Forex Factory detailing the misadventures of FX Open, a forex dealer with one of the worst reputations in the business.
http://www.forexfactory.com/showthread.php?t=50202
http://www.forexfactory.com/showthread.php?t=50879
http://www.forexfactory.com/showthread.php?t=66136
http://www.forexfactory.com/showthread.php?t=55103
Now if you ask FX Open they blame their poor reputation on the scoundrels at Poltek FX who they claim have been waging a systematic propaganda campaign designed to discredit their firm.
http://fxopen.com/News.aspx?Id=fd4b2...9-d1c48b7015bd
But who is FX Open? Well, nobody really knows. There is no business address listed on their website. There is no Board of Directors or head shots of executive officers. If you really press them they’ll give you an address in Egypt or tell you that they are registered in the Seychelles. And if that isn’t confusing enough one muckraking trader found out that their website is registered in Florida to a “Mr. John Fool.”
http://www.forexfactory.com/showpost...&postcount=101
So they could be anywhere and everywhere. They could be someone or no one. In short, they can up and vanish like a fart in the wind if they have to.
FX Open is also one of the too numerous to count unregulated MT4 brokers preying upon the desperation of those traders who have fallen in love with MetaQuotes’ software. And like so many of these unregulated forex brokers they are in the habit of misleading the public about their unregulated status. When a customer asked them if they were regulated this was their response:
http://www.forex-tsd.com/195190-post316.html
QuoteDislikedFXOpen is offshore broker and FXOpen's business activity is regulated by SIBA.
http://www.fxopen.com/documents.aspx
Now let’s go to the SIBA website and find out just what this means. The following are the key features of the law that supposedly “regulates” FX Open:
http://www.siba.net/Pages/siba.htm
• No requirement to disclose the beneficial owners of an IBC
• No minimum capital stipulation
• No need to file accounts with the Registrar
In short, FX Open’s “regulation” consists of a useless piece of paper that probably cost them a $100 in filing fees. They are no more regulated than is some ten year old kid’s lemonade stand.
That alone should convince traders to STAY AWAY from them. But the truth is that’s just the tip of the iceberg with these guys.
FX Open has made a lot of enemies in their brief history. One of them is a Kazakhstan native who goes by the name of Erlan. Erlan was a former customer of FX Open’s and he setup a website completely devoted to getting back $50,000 that he claims FX Open stole from him: http://fxopen.info/
FX Open then responded to Erlan with a website of their own (http://erlan.info/) telling a wild story that included accusations that Erlan was sending all of FX Open’s customers “penis enlargement” emails, was trying to crash FX Open’s server and hack FX Open’s customer files and was actually the customer of a former business partner of FX Open’s (Poltek FX) based in Russia that was using Erlan to get back at FX Open. (More on Erlan and his shenanigans in Part II of Metatrader Misery.)
http://www.forexfactory.com/showpost...6&postcount=13
Now seriously, who in their right mind is going to open an account with FX Open after hearing such a loopy tale? And it gets even zanier. Someone claiming to be FX Open’s CEO starts posting at Forex Factory demanding that the forum moderator stop banning supporters of FX Open or else they’ll sue Forex Factory.
http://www.forexfactory.com/showpost...4&postcount=84
The moderator replies that FX Open is a scam and the man claiming to be FX Open’s CEO quickly slinks out the back door after he sees his threats are being ignored. Indeed, FX Open gets completely banned from the forum and is forced to waddle over to Forex TSD where they cause another huge fight with traders screaming that FX Open is a scam and should be banned.
Is FX Open a scam? It’s just not clear. FX Open’s lack of transparency is deeply troubling. Their communication with the public is so unprofessional and their English so mangled that one gets the impression that Borat is running the company. They are also as I have stated before unregulated so if they ever get into trouble they are accountable to no one. At the end of the day this is what the trading public should be most concerned about.
The public should also be concerned about the firm’s alleged dealing practices. The number one complaint against FX Open is that they are a ruthless market maker that has no patience for customers who actually make money. Now this is a common complaint against many market makers. But in the threads referenced above I’ve never seen so many traders screaming about a firm’s dealing practices. Trader after trader complains about profits being removed from their accounts. Numerous traders complain of how the firm booted them out only after they made profits. Traders complain about terrible execution in numbers that really call into question the dealing ethics of this firm.
FX Open’s reply is that all these complaining customers are using some kind of secret software that allows them to “cheat” and make big profits off them. Thus they have no choice but to close the accounts of these cheating customers. I’m aware that there are some traders out there who are skilled at jumping in and out of the market in short bursts due to price discrepancies and latency issues. But this is very difficult to do. Yet judging from FX Open’s claims you would think that there are hordes of these traders out there raping and pillaging poor little forex dealers like FX Open.
Having said all that are some of these complaints against FX Open being orchestrated by their enemies? It appears so. And in part II of Metatrader Misery we’ll take a look at FX Open’s rival “Poltek FX” to uncover what these guys are up to.
- #714
- Apr 28, 2008 11:18pm Apr 28, 2008 11:18pm
FX Savior,
I thought that you made it clear... why on earth would you waist you time with a broker like that? I mean i personally wont do business with any Forex Only FCM because you just dont know whose behind the curtain. In this business you never really know what you are getting but if you ask me a large Futures FCM that does forex probably has alot more internal regulation and compliance than a Forex only shop (bucket or not) that will bring anyone with a bit of cash on board.
I just think that in this industry sometimes you have to pick your spots and go with your gut. and sometimes you just have to use your brain. How on earth does a broker make money if they charge no spread and no commission? they are going to make it somehow and seeing as there are absolutely no rules to protect your money because every fx agreement has you sign them away anyhow and Maybe just maybe they might offer no spread and no commission to raise as alot of money in a short amount of time then go Poooof.
But hey i heard cyprus is nice this time of year maybe you can get your money back by taking a trip out there to see if theres anyone at their PO box, I mean office. If you see Robert Gray out there tell him that i think there are some people looking for him back in the states...
I thought that you made it clear... why on earth would you waist you time with a broker like that? I mean i personally wont do business with any Forex Only FCM because you just dont know whose behind the curtain. In this business you never really know what you are getting but if you ask me a large Futures FCM that does forex probably has alot more internal regulation and compliance than a Forex only shop (bucket or not) that will bring anyone with a bit of cash on board.
I just think that in this industry sometimes you have to pick your spots and go with your gut. and sometimes you just have to use your brain. How on earth does a broker make money if they charge no spread and no commission? they are going to make it somehow and seeing as there are absolutely no rules to protect your money because every fx agreement has you sign them away anyhow and Maybe just maybe they might offer no spread and no commission to raise as alot of money in a short amount of time then go Poooof.
But hey i heard cyprus is nice this time of year maybe you can get your money back by taking a trip out there to see if theres anyone at their PO box, I mean office. If you see Robert Gray out there tell him that i think there are some people looking for him back in the states...
Metatrader Misery- Part II
Is Erlan Saduakasov a real person? Well, judging from this You Tube video he is.
Erlan has been waging a non-stop crusade against FX Open for several months now. He appears on bulletin boards, has his own website (http://fxopen.info/) and appears to be quite convincing. Did Erlan lose money at FX Open? Probably. Is Erlan working for or working with FX Open’s hated rival Poltek FX? It sure looks that way.
The evidence is a thread at ForexTSD in which Erlan’s IP address gets traced back to one of Poltek FX’s offices in St. Petersburg, Russia.
http://www.forex-tsd.com/metatrader-...rs-scam-5.html
The office Erlan was traced back to was FXIndia.org, which is one of the many front groups Poltek uses to recruit customers. Other ones include “Master Forex” (yup, that’s the Swiss outfit that said it doesn’t need to get a banking license and you’ll know why in a moment), Beaverhead Financial, Iberia Forex, and others.
Poltek’s official business address is listed in Belize and like FX Open they too have a useless fill in the blank “certificate” which can be flashed in the faces of naïve traders whenever pesky questions about “regulation” come up:
http://www.poltekfx.com/pic/sertificat.jpg
Another note about Poltek’s address is that their other company, MasterForex, claims an address in Switzerland. Yet it appears this address is fictitious. When a poster at a bulletin board stated they couldn’t actually find Masterforex’s office and asked them if this office even existed a Masterforex’s spokesman refused to provide any additional information and just stated “we also have an office in Russia where you can meet us.” You’d have to be a pretty brave person to want to visit this Russian office knowing the Swiss office actually listed on their website is bogus.
http://carigold.com/portal/forums/sh...=26720&page=12
As for Master Forex’s regulatory status, you guessed it; Master Forex has its own certificate from the Seychelles it likes to use to ward off those evil regulatory spirits: http://www.masterforex.org/upload/image/fullsize/13.jpg
Why so many different registrations and addresses? Well I guess it never hurts to have a second getaway vehicle in case the first one breaks down. And just as with FX Open you won’t find the actual names of any CEO’s or executive officers on any of these websites. Just addresses for P.O. boxes or links to instant messenger addresses. I’m stunned that anyone would actually consider sending their money to such financial phantoms who can conjure themselves up on a moment’s notice and then disappear without leaving a trace.
Of course, Poltek knows their lack of credibility is a problem which is why they dangle all sorts of goodies before the trading public’s eyes in an attempt to make sure traders don’t look behind the curtain. They offer pip rebates, insane 500:1 leverage, trading volume bonuses, deposit bonuses and even have a special bonus for traders who drive up traffic on their forums by posting sycophantic rubbish.
http://www.poltekfx.com/promotions.html
So even though Poltek has no credibility they are able to woo newbies who are looking for a bargain. But the competition for these newbies is fierce which is why Poltek and FX Open are at each other’s throats.
This Russian version of the Hatfields and the McCoys is likely to continue well into the future with both screeching at each other in the comical form of broken English as seen below in this Poltek broadside against FX Open:
http://www.forex-tsd.com/183206-post4.html
I love how Poltek, with its busted English and awful grammar, has the nerve to ridicule FX Open’s poor language skills. I don’t think that is the best strategery Poltek should be using against FX Open. In any case FX Open claims Poltek stole their clients and Poltek claims FX Open stole its clients… This tit for tat pretty much summarizes the poor state of affairs these two firms find themselves in today.
So to those MT4 traders who are constantly on the move like Bedouin tribesmen in search of a broker, be sure not to pitch your tents with either of these two dealers. Bedouins are supposed to be adept at spotting mirages, and FX Open and Poltek FX are merely mirages of legitimate forex dealers.
Is Erlan Saduakasov a real person? Well, judging from this You Tube video he is.
Inserted Video
Erlan has been waging a non-stop crusade against FX Open for several months now. He appears on bulletin boards, has his own website (http://fxopen.info/) and appears to be quite convincing. Did Erlan lose money at FX Open? Probably. Is Erlan working for or working with FX Open’s hated rival Poltek FX? It sure looks that way.
The evidence is a thread at ForexTSD in which Erlan’s IP address gets traced back to one of Poltek FX’s offices in St. Petersburg, Russia.
http://www.forex-tsd.com/metatrader-...rs-scam-5.html
The office Erlan was traced back to was FXIndia.org, which is one of the many front groups Poltek uses to recruit customers. Other ones include “Master Forex” (yup, that’s the Swiss outfit that said it doesn’t need to get a banking license and you’ll know why in a moment), Beaverhead Financial, Iberia Forex, and others.
Poltek’s official business address is listed in Belize and like FX Open they too have a useless fill in the blank “certificate” which can be flashed in the faces of naïve traders whenever pesky questions about “regulation” come up:
http://www.poltekfx.com/pic/sertificat.jpg
Another note about Poltek’s address is that their other company, MasterForex, claims an address in Switzerland. Yet it appears this address is fictitious. When a poster at a bulletin board stated they couldn’t actually find Masterforex’s office and asked them if this office even existed a Masterforex’s spokesman refused to provide any additional information and just stated “we also have an office in Russia where you can meet us.” You’d have to be a pretty brave person to want to visit this Russian office knowing the Swiss office actually listed on their website is bogus.
http://carigold.com/portal/forums/sh...=26720&page=12
As for Master Forex’s regulatory status, you guessed it; Master Forex has its own certificate from the Seychelles it likes to use to ward off those evil regulatory spirits: http://www.masterforex.org/upload/image/fullsize/13.jpg
Why so many different registrations and addresses? Well I guess it never hurts to have a second getaway vehicle in case the first one breaks down. And just as with FX Open you won’t find the actual names of any CEO’s or executive officers on any of these websites. Just addresses for P.O. boxes or links to instant messenger addresses. I’m stunned that anyone would actually consider sending their money to such financial phantoms who can conjure themselves up on a moment’s notice and then disappear without leaving a trace.
Of course, Poltek knows their lack of credibility is a problem which is why they dangle all sorts of goodies before the trading public’s eyes in an attempt to make sure traders don’t look behind the curtain. They offer pip rebates, insane 500:1 leverage, trading volume bonuses, deposit bonuses and even have a special bonus for traders who drive up traffic on their forums by posting sycophantic rubbish.
http://www.poltekfx.com/promotions.html
So even though Poltek has no credibility they are able to woo newbies who are looking for a bargain. But the competition for these newbies is fierce which is why Poltek and FX Open are at each other’s throats.
This Russian version of the Hatfields and the McCoys is likely to continue well into the future with both screeching at each other in the comical form of broken English as seen below in this Poltek broadside against FX Open:
http://www.forex-tsd.com/183206-post4.html
QuoteDislikedOne of these days we have released a newsletter to all our customers, stating that Poltek Fx. starts operating since the 10th of January. Right after that FxOpen Scam Company has published a piece of news about the so-called "phishing emails". You can read it here (FXOpen forex broker - forex services - forex trading).
We are more than suprised with such reaction and would like to state the following:
When you opened your accounts, you did it at Poltek Company, because at that time Poltek used to cooperate with FxOpen. FxOpen is operated by two persons, has no real office, or location and is well known over the web for scamming their customers. You can read about it at [url=http://fxopen.info]
This is the reasin why we don't work with them any more.
After that the head of FxOpen has stolen the whole customer database (including funds and orders) from Poltek and opened his own so-called "brokerage" Belveder. This case was reported to Metaquotes Inc, and their Metatader license is under question now.One case of deceptions (among great many of them) of clients is here: FXOpen.com is a scam company! Beware!
Fxopen itself try to hide these facts.
Besides, the PR director of FxOpen, seems to know English poorly (he is actually a young man from one of the former Soviet Republics), and doesn't know what a "phishing email" actually is. Let us forgive the under-educated boy, but in fact a phishing email always tries to receive some data from you. Logins, passwords, etc. WE ARE IN NO WAY TRY TO RECEIVE ANY INFORMATION FROM YOU. This newsletter is intented only to let our customers know that the company, where they have their trading accounts has started to operate again with even better level of services.
I love how Poltek, with its busted English and awful grammar, has the nerve to ridicule FX Open’s poor language skills. I don’t think that is the best strategery Poltek should be using against FX Open. In any case FX Open claims Poltek stole their clients and Poltek claims FX Open stole its clients… This tit for tat pretty much summarizes the poor state of affairs these two firms find themselves in today.
So to those MT4 traders who are constantly on the move like Bedouin tribesmen in search of a broker, be sure not to pitch your tents with either of these two dealers. Bedouins are supposed to be adept at spotting mirages, and FX Open and Poltek FX are merely mirages of legitimate forex dealers.
It has not been a good year for Interbank FX. First FXLQ goes down resulting in the firm losing a key liquidity provider. Then FXLQ goes into receivership taking $10 million of IBFX's net capital with it. Now IBFX has just announced to the public that there was a major security breach and that customers who had applied for an account prior to April 2, 2007, had their personal information exposed on a rogue server accessible to anyone on the internet.
http://doj.nh.gov/consumer/pdf/interbank.pdf
To IBFX's credit they appear to have taken immediate steps to secure the information and are offering those customers who were potentially exposed free membership to a credit monitoring company. I'm not familiar with Corporate Law but it appears IBFX hired Kirkland & Ellis to contact State Attorneys General about this? Pretty Intensive damage control by the folks at Interbank.
But considering the news has broken all over the net well outside the forex community best to cover all bases I guess: http://www.google.com/search?hl=en&r...ecurity+breach
Let's hope Robert Gray hasn't been lurking around this rogue server all this time...
http://doj.nh.gov/consumer/pdf/interbank.pdf
To IBFX's credit they appear to have taken immediate steps to secure the information and are offering those customers who were potentially exposed free membership to a credit monitoring company. I'm not familiar with Corporate Law but it appears IBFX hired Kirkland & Ellis to contact State Attorneys General about this? Pretty Intensive damage control by the folks at Interbank.
But considering the news has broken all over the net well outside the forex community best to cover all bases I guess: http://www.google.com/search?hl=en&r...ecurity+breach
Let's hope Robert Gray hasn't been lurking around this rogue server all this time...
Fransesc Riverola is doing a top notch job at FX Street keeping traders up to date about the latest regulatory changes in Switzerland. He has sent out questionnaires to the Swim FX Broker community and several have responded, most recently Crown Forex who has stated they are applying for a banking license.
http://weblog.fxstreet.com/2008/04/open-letter-t-1.html
Crown Forex’s CEO was quoted as saying:
BINGO. He is dead on. This is why I started the Swiss Dealer Dead Pool. The gig is up for the schlock shops in Switzerland. Either get a banking license or in the words of Der Terminator “GET OUT!” Firms will need to have a minimum $9 million in firm capital and meet a whole variety of accounting requirements in order to get a banking license.
The CEO of Crown Forex closed his remarks by saying:
Here an updated Dead Pool for the trading public.
Firms that claim they are applying for a banking license
1) ACM
2) Fibo Group
3) Crown Forex
4) DukasCopy
5) MIGfx
6) GFX Group (forex.ch)
Firms that are fleeing Swiss Regulation
1) Masterforex. Their business office is listed in Switzerland but they are registered in the Seychelles and have stated they do not need to get a banking license.
2) forex-swiss. FXCH, despite the fact they are NAMED "Forex Swiss" claim registration in Dominica. This is an odd company that has claimed multiple office addresses over the years including, Switzerland, Austria, South Africa, Iran, and the United States. Today they are claiming they have offices in Dominica and the United Kingdom. Tomorrow who knows, they could claim a mailing address in Tibet. Beware this firm.
3) Prime4X. Their head office is in Switzerland but they have stated they are applying for a license in Cyprus.
Firms that are no longer accepting customers or have been shutdown
1) WestCapFX
2) Tradex Swiss AG
3) Finex
4) Aleccohfx
Firms that refuse to comment
1) Swiss Direkt
2) Tadawulfx
3) Advised Trading
As always conduct your due diligence and make sure the firm you trade with is regulated and legit.
http://weblog.fxstreet.com/2008/04/open-letter-t-1.html
Crown Forex’s CEO was quoted as saying:
QuoteDislikedinvestors must be very careful when dealing with Swiss brokers that do not see the high importance of applying for a bank license. It is important to keep in mind that many small brokers will not be able to apply or even comply with the new regulations due to the huge financial requirements this type of license incurs.
BINGO. He is dead on. This is why I started the Swiss Dealer Dead Pool. The gig is up for the schlock shops in Switzerland. Either get a banking license or in the words of Der Terminator “GET OUT!” Firms will need to have a minimum $9 million in firm capital and meet a whole variety of accounting requirements in order to get a banking license.
The CEO of Crown Forex closed his remarks by saying:
QuoteDislikedAs a result in the regulatory ordinances in Switzerland, very few Swiss brokers will remain in the game, if I may say so, by the end of 2009. Probably only 5 or 6 brokers will survive out of all the brokers, whether medium or small.
Here an updated Dead Pool for the trading public.
Firms that claim they are applying for a banking license
1) ACM
2) Fibo Group
3) Crown Forex
4) DukasCopy
5) MIGfx
6) GFX Group (forex.ch)
Firms that are fleeing Swiss Regulation
1) Masterforex. Their business office is listed in Switzerland but they are registered in the Seychelles and have stated they do not need to get a banking license.
2) forex-swiss. FXCH, despite the fact they are NAMED "Forex Swiss" claim registration in Dominica. This is an odd company that has claimed multiple office addresses over the years including, Switzerland, Austria, South Africa, Iran, and the United States. Today they are claiming they have offices in Dominica and the United Kingdom. Tomorrow who knows, they could claim a mailing address in Tibet. Beware this firm.
3) Prime4X. Their head office is in Switzerland but they have stated they are applying for a license in Cyprus.
Firms that are no longer accepting customers or have been shutdown
1) WestCapFX
2) Tradex Swiss AG
3) Finex
4) Aleccohfx
Firms that refuse to comment
1) Swiss Direkt
2) Tadawulfx
3) Advised Trading
As always conduct your due diligence and make sure the firm you trade with is regulated and legit.
With all these bogus claims from small time brokers claiming they are regulated because they hold a “certificate” they managed to pull out of a cereal box it is hard to know what to believe these days when a firm states they are “licensed.”
And perhaps no firm straddles the line between licensed and unregulated more than a firm by the name of GCI Financial. A reader asked me to provide some background on GCI recently and after doing a quick Internet search I found myself once again swimming in the deepest, darkest, murkiest depths of the Forex Ocean in search of that most dangerous dorsal finned predator of all- the offshore FX boiler-room.
GCI appears to have been started back in the 1990’s and used to be a U.S. based company with its CEO, Mitch Vasquez, living in Wilton, CT. It didn’t take too many clicks of the mouse to discover that GCI had been busted by the CFTC under the headline “CFTC CRACKS DOWN ON FOREIGN CURRENCY SCAMS NATIONWIDE.”
http://www.cftc.gov/opa/enf02/opa4611-02.htm
The complaint itself charged GCI for violating the Commodity Exchange Act. In short, the CFTC was taking GCI to court because they had not registered with the NFA (Hello FXDD! This could someday happen to you!)
http://www.cftc.gov/files/enf/02orders/enfgci-order.pdf
Also cited in this lawsuit was Vazquez. In 2002, Vazquez and GCI settled the suit and as part of the settlement Vazquez paid a $100,000 fine and agreed to
Sounds pretty clear to me. Basically, Vazquez and GCI were expected to close their doors and get out of the FX business.
But apparently GCI didn’t see it that way. Instead, they submerged beneath the water and headed to Belize. Well at least their “State of the Art” dealing room fled to Belize. But Vazquez doesn’t appear to have gone anywhere as a FEC filing showed he contributed $2000 to George Bush’s Presidential Campaign in 2004 where he listed an address in New Canaan, CT.
http://fundrace.huffingtonpost.com/neighbors.php?type=name&lname=VAZQUEZ&fname=MITCHELL
Meanwhile in Switzerland (cue up Jaws music)…
According to the gossip on the bulletin boards Vazquez had apparently branched out into the notorious Swiss Market. Rumor has it that GCI and GFX (Forex.CH) are the same firm. This was news to me. But several people have stated that Vazquez is also a director at GFX and also points out that the websites of GCI and GFX are remarkably similar and also housed on the same servers?
http://www.elitetrader.com/vb/showthread.php?perpage=40&pagenumber=1&threadid=76386
http://www.forexfactory.com/showthread.php?t=7884
http://www.forexpeacearmy.com/public/review/www.gfxsa.com?page=0&perpage=10
Also, it appears that GFX has recently gotten into some trouble with the Swiss Government according to one trader who cited this (translation welcome if anyone speaks Francais):
http://rc.geneve.ch/rc/consultation/consultationcomplete.asp?no_dossier_fed=CH-660-1425005-9
As for GCI, it claims registration in Belize and you can actually verify they are in fact licensed by the regulatory authorities there:
http://www.ifsc.gov.bz/licensed_provider.html#f
Strangely, GCI doesn’t provide this link on their website which would allow traders to verify this independently which I just did as the Savior is nothing if not fair and balanced.
The reason GCI may be quiet about their regulatory status with Belize officials is because the IFSC does not actually do much aside from collect fees and provide “guidelines” to businesses. In fact, they state on their own website:
http://www.ifsc.gov.bz/about.html
Bwahahaha! As if a forex firm that has been driven out of the United States for being a “scam” is going to properly “self-regulate” itself. This tells you about all you need to know about the quality of Belize regulation.
So what should traders take from all this? Common sense would dictate that traders avoid GCI. Their compliance history is poor and their current regulators in Belize clearly don’t give a damn what they do so long as they pay their bills on time. At the end of the day GCI is just another shark in the water. Here’s hoping someone harpoons them and sends them to the bottom of the ocean from whence they can never be dredged up again.
And perhaps no firm straddles the line between licensed and unregulated more than a firm by the name of GCI Financial. A reader asked me to provide some background on GCI recently and after doing a quick Internet search I found myself once again swimming in the deepest, darkest, murkiest depths of the Forex Ocean in search of that most dangerous dorsal finned predator of all- the offshore FX boiler-room.
GCI appears to have been started back in the 1990’s and used to be a U.S. based company with its CEO, Mitch Vasquez, living in Wilton, CT. It didn’t take too many clicks of the mouse to discover that GCI had been busted by the CFTC under the headline “CFTC CRACKS DOWN ON FOREIGN CURRENCY SCAMS NATIONWIDE.”
http://www.cftc.gov/opa/enf02/opa4611-02.htm
The complaint itself charged GCI for violating the Commodity Exchange Act. In short, the CFTC was taking GCI to court because they had not registered with the NFA (Hello FXDD! This could someday happen to you!)
http://www.cftc.gov/files/enf/02orders/enfgci-order.pdf
Also cited in this lawsuit was Vazquez. In 2002, Vazquez and GCI settled the suit and as part of the settlement Vazquez paid a $100,000 fine and agreed to
QuoteDisliked“for a period of three years, not to act in any capacity or affiliate in any way with any individual or entity which involves the solicitation, acceptance of orders, transmissions of orders, execution, advice related to, pooling of funds, or recommendation for or of futures contracts, options on futures contracts, or options on foreign currency either (i) for or on behalf of any U.S. citizen or U.S. resident, regardless of where cleared or conducted; or (ii) that are cleared or conducted in the U.S., whether on or off-exchange, regardless of the citizenship or residency of the parties.
Sounds pretty clear to me. Basically, Vazquez and GCI were expected to close their doors and get out of the FX business.
But apparently GCI didn’t see it that way. Instead, they submerged beneath the water and headed to Belize. Well at least their “State of the Art” dealing room fled to Belize. But Vazquez doesn’t appear to have gone anywhere as a FEC filing showed he contributed $2000 to George Bush’s Presidential Campaign in 2004 where he listed an address in New Canaan, CT.
http://fundrace.huffingtonpost.com/neighbors.php?type=name&lname=VAZQUEZ&fname=MITCHELL
Meanwhile in Switzerland (cue up Jaws music)…
According to the gossip on the bulletin boards Vazquez had apparently branched out into the notorious Swiss Market. Rumor has it that GCI and GFX (Forex.CH) are the same firm. This was news to me. But several people have stated that Vazquez is also a director at GFX and also points out that the websites of GCI and GFX are remarkably similar and also housed on the same servers?
http://www.elitetrader.com/vb/showthread.php?perpage=40&pagenumber=1&threadid=76386
http://www.forexfactory.com/showthread.php?t=7884
http://www.forexpeacearmy.com/public/review/www.gfxsa.com?page=0&perpage=10
Also, it appears that GFX has recently gotten into some trouble with the Swiss Government according to one trader who cited this (translation welcome if anyone speaks Francais):
http://rc.geneve.ch/rc/consultation/consultationcomplete.asp?no_dossier_fed=CH-660-1425005-9
As for GCI, it claims registration in Belize and you can actually verify they are in fact licensed by the regulatory authorities there:
http://www.ifsc.gov.bz/licensed_provider.html#f
Strangely, GCI doesn’t provide this link on their website which would allow traders to verify this independently which I just did as the Savior is nothing if not fair and balanced.
The reason GCI may be quiet about their regulatory status with Belize officials is because the IFSC does not actually do much aside from collect fees and provide “guidelines” to businesses. In fact, they state on their own website:
http://www.ifsc.gov.bz/about.html
QuoteDisliked“The Commission relies on self-regulation, meaning that while government sets overall standards, it expects much of the actual work in terms of monitoring and compliance to be done by the industry itself.”
Bwahahaha! As if a forex firm that has been driven out of the United States for being a “scam” is going to properly “self-regulate” itself. This tells you about all you need to know about the quality of Belize regulation.
So what should traders take from all this? Common sense would dictate that traders avoid GCI. Their compliance history is poor and their current regulators in Belize clearly don’t give a damn what they do so long as they pay their bills on time. At the end of the day GCI is just another shark in the water. Here’s hoping someone harpoons them and sends them to the bottom of the ocean from whence they can never be dredged up again.
This is going to be a post rife with Texas sized clichés. How can it not be with a company with a name like “eToro” that has a logo with a pair of bull horns jutting out of it?
First of all who are these guys? Well they are one the newest FX brokers in the market who are taking a very novel approach to currency trading. They also have ties to the online gambling rackets as their CTO is David Ring who was a key R&D leader at Israeli-based 888.com (a major online casino and poker operator) according to this feature article that came out last fall:
http://www.techcrunch.com/2007/11/27/etoro-makes-forex-trade-childs-play
But this Israeli firm’s ties go much deeper than to just an Internet gambling website (and please spare me the term “gaming.”) They also have connections to none other than Shimon Peres, the President of Israel. It appears Shimon Peres’ son, Chimi Peres, is one of eToro’s private investors:
http://www.pitango.com/team_member.asp?ID=25
So how is eToro standing out in the marketplace aside from their exotic resume? Well they have created the first forex video game. You have to see the screen shots to believe them:
http://www.techcrunch.com/wp-content/etoro_match.jpg
http://www.techcrunch.com/wp-content/etoro_marathon.jpg
But aside from the cute cartoon characters inhabiting its software (which led one trader to state eToro should rename itself “eTarded”) the truth is eToro is just shoveling the same old Bull at traders. What makes me say that? Well, when I asked them if they were regulated they gave me the ol’ Texas Two Step. Check out this chat transcript below:
eToro is an Israeli company with a Cyprus address and a British Virgin Islands Registration. Now what kind of business arrangement is that? That is about as unaccountable as you can get. When I asked their chat representative if they have a Cyprus SEC license (which they should have if they have an office in Cyprus and are soliciting customers from Cyrpus) the rep says “of course.”
When I point out that eToro is not listed as having a license at the Cyprus SEC website I’m directed to another company that supposedly has a license, retailfx.com, I find they don’t have a license either. At which point the customer service rep breaks down and blabbers about their arrangement with IFX.
Clearly eToro talks the regulatory talk but they don’t walk the regulatory walk.
So what about this link with IFX? Well it turns out that eToro can’t accept U.S. customers. Hmmm. That’s strange. Plenty of offshore forex brokers accept U.S. customers. Why not eToro? Instead, eToro has to rely on IFX who is apparently white labeling eToro’s Sony Playstation, er, forex trading software.
It’s pretty obvious why eToro can’t accept U.S. customers. It’s because they are nothing more than a gambling shop and online casinos outside the U.S. are not allowed to accept U.S. customers. eToro’s lawyers are obviously worried that Uncle Sam will come after them with a vengeance if they start soliciting customers (not to mention the MGM Grand, Powerball, Pat Robertson, Ralph Reed and Mike Huckabee.)
What does that tell you about the kind of dealing desk these guys are running? The firm is a straight up casino- they only make money if you lose money. It is market making on anabolic horse steroids. In short, it is every currency trader’s worst nightmare come true.
By the way I sent eToro an email asking for clarification on their regulation. Of course there was no reply. Lord somebody fence these guys in…
First of all who are these guys? Well they are one the newest FX brokers in the market who are taking a very novel approach to currency trading. They also have ties to the online gambling rackets as their CTO is David Ring who was a key R&D leader at Israeli-based 888.com (a major online casino and poker operator) according to this feature article that came out last fall:
http://www.techcrunch.com/2007/11/27/etoro-makes-forex-trade-childs-play
But this Israeli firm’s ties go much deeper than to just an Internet gambling website (and please spare me the term “gaming.”) They also have connections to none other than Shimon Peres, the President of Israel. It appears Shimon Peres’ son, Chimi Peres, is one of eToro’s private investors:
http://www.pitango.com/team_member.asp?ID=25
So how is eToro standing out in the marketplace aside from their exotic resume? Well they have created the first forex video game. You have to see the screen shots to believe them:
http://www.techcrunch.com/wp-content/etoro_match.jpg
http://www.techcrunch.com/wp-content/etoro_marathon.jpg
But aside from the cute cartoon characters inhabiting its software (which led one trader to state eToro should rename itself “eTarded”) the truth is eToro is just shoveling the same old Bull at traders. What makes me say that? Well, when I asked them if they were regulated they gave me the ol’ Texas Two Step. Check out this chat transcript below:
QuoteDislikedDaniel: Welcome to eToro! How can I help you?
you: I was interested in opening a new account with you and see that you are based in Cyprus. Are you registered with the Cyprus Securities and Exchange Commission?
Daniel: of course
you: oh good. what is you Cyprus sec number?
you: i don't see you firm listed in their database
Daniel: I'm sorry. I can only give you support regarding our platform
Daniel: for more information you can address our website
Daniel: or retailfx's website
you: but your website says nothing about you sec license
you: what is retail fx's website?
Daniel: http://www.retailfx.com/
Daniel: this is our worldwide broker
you: this website says nothing about your license either
you: so do you have a license or not?
Daniel: I'm not sure what you are looking for
Daniel: i can help you regarding our platform
you: Do you have a Cyprus Securities and Exchange license?
Daniel: we do have a license
you: is it a Cyprus SEC license?
you: What kind of license do you have?
Daniel: I'm sorry... I don't know these details. I can only give support regarding our platform
you: ok do you have an email address?
you: who can I speak to about this?
Daniel: [email protected]
you: I just want to make sure you are a legitimate company
you: there are a lot of scammers in fx
Daniel: we are totally legit
Daniel: you can check with IFX
you: who?
Daniel: and the NFA
you: nfa?
you: you have an nfa license?
Daniel: IFX..our US broker
Daniel: we are regulated by the NFA
you: eToro has a nfa license?
Daniel: would you please send us an organized email with all of your questions?
eToro is an Israeli company with a Cyprus address and a British Virgin Islands Registration. Now what kind of business arrangement is that? That is about as unaccountable as you can get. When I asked their chat representative if they have a Cyprus SEC license (which they should have if they have an office in Cyprus and are soliciting customers from Cyrpus) the rep says “of course.”
When I point out that eToro is not listed as having a license at the Cyprus SEC website I’m directed to another company that supposedly has a license, retailfx.com, I find they don’t have a license either. At which point the customer service rep breaks down and blabbers about their arrangement with IFX.
Clearly eToro talks the regulatory talk but they don’t walk the regulatory walk.
So what about this link with IFX? Well it turns out that eToro can’t accept U.S. customers. Hmmm. That’s strange. Plenty of offshore forex brokers accept U.S. customers. Why not eToro? Instead, eToro has to rely on IFX who is apparently white labeling eToro’s Sony Playstation, er, forex trading software.
It’s pretty obvious why eToro can’t accept U.S. customers. It’s because they are nothing more than a gambling shop and online casinos outside the U.S. are not allowed to accept U.S. customers. eToro’s lawyers are obviously worried that Uncle Sam will come after them with a vengeance if they start soliciting customers (not to mention the MGM Grand, Powerball, Pat Robertson, Ralph Reed and Mike Huckabee.)
What does that tell you about the kind of dealing desk these guys are running? The firm is a straight up casino- they only make money if you lose money. It is market making on anabolic horse steroids. In short, it is every currency trader’s worst nightmare come true.
By the way I sent eToro an email asking for clarification on their regulation. Of course there was no reply. Lord somebody fence these guys in…
You should check the NFA webpage next time instead of asking a customer service rep who obviously knows nothing. http://www.nfa.futures.org/basicnet/...d=0382918&rn=N