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Non-US Broker Question

  • #1
  • First Post: Aug 20, 2010 11:10am Aug 20, 2010 11:10am
Anybody hear anything about a new ruling that was passed at the end of July stating that we will need to bring our overseas FOREX account back to a US broker by the end of the year?

I was just told that by a US based FOREX broker but don't know if it's true.

I might need to start looking again if true.


  • #2
  • Aug 20, 2010 1:30pm Aug 20, 2010 1:30pm
This is nonsense.

I'm keeping my funds at fxopen!
  • #3
  • Aug 20, 2010 2:09pm Aug 20, 2010 2:09pm
I hope you are correct.

I have just sent my broker an e-mail inquiring about it, and will let the forum know what I find out.
  • #4
  • Aug 20, 2010 2:47pm Aug 20, 2010 2:47pm
Here is the reply to my e-mail :

Dear Steve,

Thank you for your email.

At this time the we have not been told there will be any changes. If there were to be any regulation changes either for US or UK accounts under our Gain Capital and Forex.com we will notify you. At this point this has not occurred and we will continue to operate the same way until notified otherwise.

Thank you.

If you have any other questions please email us again or call 0800 032 1948.

Regards,
Client Services Team
FOREX.com

Have a great weekend!
  • #5
  • Aug 20, 2010 3:46pm Aug 20, 2010 3:46pm
Its the initiative started by that Dodd bill thats due out at the end of the year. CFTC is still working on the out come so don't jump the gun just yet.

The bill is for traders to only use CFTC/NFA registered brokers which means overseas brokers would have to apply for NFA authorization before taking on US clients. Another part of the bill calls for US traders to only trade with brokers registered with the NFA and located on US soil.

While most traders are focused on the 50:1 level of the bill, the most important aspect of the bill is NFA registered brokers aspect. There are many counter ways against the bill if it is in fact passed. One being if oversea fx trading is prohibited then why not overseas banking? Which is very much legal.
  • #6
  • Aug 20, 2010 4:49pm Aug 20, 2010 4:49pm
Thanks for the update.

Looks like it might get interesting.
  • #7
  • Aug 26, 2010 7:09pm Aug 26, 2010 7:09pm
Here is the link to an article that discusses this issue of how non-US brokers could be affected by the Dodd-Frank Reg. Fin. Bill:

http://blogs.forbes.com/greatspecula...forex-traders/

And also, here is the link to a conference call that discusses and analyzes this more in length:

http://www.greencompany.com/Educatio...ngs-1003.shtml
Make your losses in demo. Earn your profits live.
  • #8
  • Aug 26, 2010 8:31pm Aug 26, 2010 8:31pm
Here are a couple other links:

http://www.forexlawblog.com/

http://www.mallonpc.com/news-events/...d-registration


The more I read, the more convinced I am that Dodd-Frank Act will not effect off-shore accounts/brokers... at least not directly. Just remember, every country on planet earth is going through the same problems, and for the same reason. Many are probably waiting for us to finalize the plan before launching their own.
  • #9
  • Aug 26, 2010 9:43pm Aug 26, 2010 9:43pm
Quoting Slack
Here are a couple other links:

http://www.forexlawblog.com/

http://www.mallonpc.com/news-events/...d-registration


The more I read, the more convinced I am that Dodd-Frank Act will not effect off-shore accounts/brokers... at least not directly. Just remember, every country on planet earth is going through the same problems, and for the same reason. Many are probably waiting for us to finalize the plan before launching their own.
Agreed. I am about to finish listening to the Podcast. And aside from physically invading those "off-shore" countries, it is quite difficult for US regulators to enforce the regulations no matter how much they want to stretch their "extraterritorial" powers granted to them by this Act. US would need to establish the enforcements of the firms

But in the Podcast, they did mention one more partner that the CFTC can enlist in their efforts to regulate the industry, the IRS because the individual US traders would be required to declare any profits/losses made and/or assets held at foreign brokers on the Income Tax return. And from reviewing the Income Tax returns, the IRA would be able to track down the foreign brokers who have provided services to US citizens and then have CFTC check on their compliance and etc.

Looks like it's not just gonna be one "Big Brother" watching, it's a band of "Big Brothers" watching. US is scary! Get out of there! No, wait, the extraterritorial powers outlined in the Dodd-Frank Bill applies to US citizens dealing with foreign financial institutions abroad too! There is no escape!
Make your losses in demo. Earn your profits live.
  • #10
  • Aug 26, 2010 10:06pm Aug 26, 2010 10:06pm
Quoting Forexia
Agreed. I am about to finish listening to the Podcast. And aside from physically invading those "off-shore" countries, it is quite difficult for US regulators to enforce the regulations no matter how much they want to stretch their "extraterritorial" powers granted to them by this Act. US would need to establish the enforcements of the firms

But in the Podcast, they did mention one more partner that the CFTC can enlist in their efforts to regulate the industry, the IRS because the individual US traders would be required to declare any profits/losses...
We are already req'd to declare FX profit on line 21 of our 1040. or Sch _ if you itemize/have an entity. The Podcast was good, but remember, they are in the dark as much as we are; No one truly knows what is going thru the CFTC'c mind right now.

I wouldn't worry about the IRS. They are as dysfunctional as you can get. What does worry me is UK dissolving their regulatory agency... just what are they up to?

Let's continue to stay on top of the news. And, more importantly, get a solid trade plan down and start banking some $$, so we are better prepared for any eventuality.

http://www.pilgrimbethesda.org/wp-co...ers_behind.jpg
  • #11
  • Aug 26, 2010 11:06pm Aug 26, 2010 11:06pm
Quoting Slack
What does worry me is UK dissolving their regulatory agency... just what are they up to?

Let's continue to stay on top of the news. And, more importantly, get a solid trade plan down and start banking some $$, so we are better prepared for any eventuality.

http://www.pilgrimbethesda.org/wp-co...ers_behind.jpg
I am sorry what do you mean UK is dissolving their regulatory agency? the FSA?? FSA is one of the best, if not the best regulatory agency I have seen around. They really have genuine rules and requirements that really DO protect retail investors. And that's why UK has such a solid financial industry.

Why are they dissolving? No money? This is scary.
Make your losses in demo. Earn your profits live.
  • #12
  • Aug 26, 2010 11:12pm Aug 26, 2010 11:12pm
http://www.guardian.co.uk/business/2...ns-disband-fsa
  • #13
  • Aug 30, 2010 4:22pm Aug 30, 2010 4:22pm
Quoting Slack
http://www.guardian.co.uk/business/2...ns-disband-fsa
What's gonna happen after FSA has disbanded? Who's stepping into its place? The Bank of England?

Even with the regulation of banks by the Bank of England, wouldn't that be a bit of Conflict of Interest?
Make your losses in demo. Earn your profits live.
  • #14
  • Aug 30, 2010 5:59pm Aug 30, 2010 5:59pm
Quoting Forexia
What's gonna happen after FSA has disbanded? Who's stepping into its place? The Bank of England?

Even with the regulation of banks by the Bank of England, wouldn't that be a bit of Conflict of Interest?
Short answer is, I have no idea.

But, one thing I do know, After Labor Day, I will be focusing on trading/making money like never before. Whether it takes 8,10 or 14 hours a day, I don't care...
loading up on coffee and toilet paper right now.
  • #15
  • Last Post: Aug 30, 2010 6:25pm Aug 30, 2010 6:25pm
Quoting Slack
Short answer is, I have no idea.

But, one thing I do know, After Labor Day, I will be focusing on trading/making money like never before. Whether it takes 8,10 or 14 hours a day, I don't care...
loading up on coffee and toilet paper right now.
LOL Me too! Big time! I can't believe this August is THAT SLOW!! I didn't remember August being this slow last year or the year before.

Have to stack up as much money as possible before October 19 for me!

Am sure it will be fun.
Make your losses in demo. Earn your profits live.
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