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Class Action Lawsuit Against FXCM

  • #81
  • Edited 2:15am Feb 12, 2011 1:54am | Edited 2:15am
Quoting pipmutt
Especially seeing as the vast majority will eventually give their money away without any help or hindrance anyway!

I wonder if there's any truth to the rumour that brokers categorize clients into groups ie consistent winners, consistent losers and handle their (excess) trades accordingly. It would seem to make perfect sense from a business perspective, why give their money to the market when you can keep it in-house, it's not going to make any difference to the client.
This is true and although it may not make any difference, It means that the broker has alot more conflict of interest than they claim. They claim, they hedge their risk and do not actively trade against their clients and that is a bare faced lie. They keep a book and do not hedge the losing traders and pocket the winnings whilst employing every trick in the book to increase there own odds. CMC markets, a prefered broker on this website were caught and fined doing exactly this. FXCM, GO Markets and others claim to be no dealing desk STP is also a bare faced lie and false advertising. Straight through where? the orders remain in house, they are on the other side of your trade and they pocket your loss all the while pretending to be your best friend. This Law suit has legs I believe
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  • #82
  • Feb 12, 2011 2:57am Feb 12, 2011 2:57am
Quoting SunTrader
And just how are they tainted?

If I buy a Ford sedan or better yet a pickup truck and run a bunch of pedestrians over.

Does Ford have any fault in that?

Give it a little more thought and I think you'll realise that that is not a like for like comparison.

There is also a thing called 'due diligence' which companies should go through before entering into business with third parties. Theirs obviously wasn't very diligent.
He was looking for the card so high and wild hed never need to deal another
  • #83
  • Feb 12, 2011 4:22am Feb 12, 2011 4:22am
Quoting FX__jake
I actually prefer FXCM as a broker, they are quick with the withdrawal requests, customer service is pretty good. I refer traders to FXCM every week of the year, but I have to laugh when the Active Trader account is the reason why the spreads differ.

Why would an Active Trader account have greater spreads than a standard account?
mate standard account spreads is not that low , the spreads on the right of the screen shot is far from reality ...i think the left of the screen is the standard account and the right of the screen is the active trader one ...
  • #84
  • Feb 12, 2011 6:28am Feb 12, 2011 6:28am
Quoting Beljevina
And, what is the effort-to-success and risk-to-reward ratio on these types of business practices? Why so much effort to piddly accounts of a few grand? Are the pro accounts with $25/$70/$100k+ seeing the same issues? Where are their complaints?


It's amazing how the bandwagon builds on this, truthers 'et all.

I think someone said the guy bringing the lawsuit lost around $150,000

So there ya go. I wouldn't touch FXCM with your 10 foot pole. I have seen it personally, heard of countless others who have seen it.

When I say "seen it" I mean:

CHEATING

just so we are clear.
  • #85
  • Feb 12, 2011 7:24am Feb 12, 2011 7:24am
Quoting pip_seeker
I think someone said the guy bringing the lawsuit lost around $150,000

So there ya go. I wouldn't touch FXCM with your 10 foot pole. I have seen it personally, heard of countless others who have seen it.

When I say "seen it" I mean:

CHEATING

just so we are clear.
they prob got a whole gang of lawyers
  • #86
  • Feb 12, 2011 8:23am Feb 12, 2011 8:23am
Quoting dragan53
they prob got a whole gang of lawyers
yeah they probably won't need them as Judge Levine will likely hear the case and he never rules against the broker. As the story goes from the futures magazine story several months ago.

so that's the bigger problem when you have wolves that pretend to be shepherds among the flock. All under of the cloak --- we are here to protect the peeps.

If these crooks don't get their reward now. They will later.... just ask Madoff how pyramid schemes work out after a while. A scam broker is nothing more than a pyramid scheme... sooner or later you run out of suckers.... why do you think the web is littered with FX ads?

Oh the irony continues... grab some popcorn!
  • #87
  • Feb 12, 2011 8:42am Feb 12, 2011 8:42am
WOW! I'm an active user in fxcm, I think it is better to pull my accounts! I don't think anything can stop this fall. The selling volume is increasing on FXCM - NYSE!!!!!!!!!!!!!!!!!!!!!!!!!!
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  • #88
  • Feb 12, 2011 8:51am Feb 12, 2011 8:51am
But did you notice on that yahoo link that 284,916 shares traded on Friday while average volume is 452,902?? Which means it might just be a one-day event.
  • #89
  • Feb 12, 2011 8:58am Feb 12, 2011 8:58am
Yea I noticed that in yahoo, Let see what happen on Monday Morning! I'm not sure which broker we can belive in ....................................It is really bad!
  • #90
  • Feb 12, 2011 9:05am Feb 12, 2011 9:05am
Think about it, this is probably the best time to open an account with them. They will be very careful at least for a while. Retail brokers are all the same, they are just here to make money, not to be helpful to retailers and will do anything to increase their profits, each and every one of them. You just need to find the lesser of the evils.
  • #91
  • Feb 12, 2011 9:06am Feb 12, 2011 9:06am
Quoting dr_who
Give it a little more thought and I think you'll realise that that is not a like for like comparison.

There is also a thing called 'due diligence' which companies should go through before entering into business with third parties. Theirs obviously wasn't very diligent.
What about the due diligence on the "trader's" part bearing responsibilty for the choice they make.

Every FCM has their critics. If FXCM truly are crooks I hope they are taken down. But don't believe everything that is posted on the internet or filed in a court by a class-less action lawyer group.
  • #92
  • Feb 12, 2011 9:15am Feb 12, 2011 9:15am
Quoting SunTrader
WIf FXCM truly are crooks I hope they are taken down. But don't believe everything that is posted on the internet or filed in a court by a class-less action lawyer group.

It takes a great amount of ignorance and stupidity to lose 150k in a few months and then go and blame your broker. Even if every trade was requoted by a few pips and every stop was hunted, the knowledgeable trader would quickly catch on and adjust his trading accordingly.

I love these guys though, lose 150k, probably get sh!t from his buddies and his wife, so he's better of blaming and suing his broker then admit his own failure.

Any trader worth his salt can make money, no matter how sh!t his broker is. Making withdrawals and having peace of mind does mean that you should pick a broker that is well capitalised and regulated in either the EU or the US.

Most noobs don't need broker tricks to lose their account, they manage just fine on their own.

This makes for great headlines, but unless we know the background and experience of the trader, that's all it is, a few headlines. The market is not going to give a toss about this suit as they know how these brokers operate and how they make their money.
  • #93
  • Feb 12, 2011 9:35am Feb 12, 2011 9:35am
Quoting SunTrader
But did you notice on that yahoo link that 284,916 shares traded on Friday while average volume is 452,902?? Which means it might just be a one-day event.

Of course it is, just news traders and bots catching a ride. Nothing special and no indication of ultimate doom or demise. Remember BP? Not taking away from the misery and effects it had on the Gulf, but that was a great event to load up at a great price. Stock traders will look at FXCM a little closer in the weeks to come, are they well capitalised? Does their trading volume suffer? Will they keep the support of their liquidity providers. Stock price dropping by a few percent is not a big deal, if it continues to drop and lose 50% or more, then one should be worried. A small blip on low vols is not catastrophic. 24% of FXCM is held by institutions, 20% by funds with Pru, Janus, WnR, and Fidelity being the biggest ones.
  • #94
  • Feb 12, 2011 4:31pm Feb 12, 2011 4:31pm
Quoting cloggie
It takes a great amount of ignorance and stupidity to lose 150k in a few months and then go and blame your broker. Even if every trade was requoted by a few pips and every stop was hunted, the knowledgeable trader would quickly catch on and adjust his trading accordingly.

I love these guys though, lose 150k, probably get sh!t from his buddies and his wife, so he's better of blaming and suing his broker then admit his own failure.

Any trader worth his salt can make money, no matter how sh!t his broker is. Making withdrawals and having peace of...
Yep this is probably true. It does boil down to stupidity. But then its also good to give a broker a good kick-in, and exploit the bad publicity when they get it. It may keep them more honest for a few weeks until it boils over. Its an unregulated market, where you pay peanuts to trade to get a service run by monkeys. Fun and games for the rest of us..
  • #95
  • Feb 12, 2011 4:54pm Feb 12, 2011 4:54pm
Quoting Porkpie
Yep this is probably true. It does boil down to stupidity. But then its also good to give a broker a good kick-in, and exploit the bad publicity when they get it. It may keep them more honest for a few weeks until it boils over. Its an unregulated market, where you pay peanuts to trade to get a service run by monkeys. Fun and games for the rest of us..

We live in such a blame culture nowadays that very few take responsibility for their own actions anymore. Always easier to blame and sue someone else. I love the stories too of plenty of retailers here that say as soon as they left broker XXX they became profitable, totally ignoring that they became profitable in spite of leaving broker XXX. Always easier to blame the faceless broker then owning up for his/her own screw ups.

We see it every day on the threads here, my broker hunted my stops (then don't put them in the obvious places you muppet) the news is manipulated so I got stopped out (learn to trade the fundies !d!ot), the big boys are manipulating the price (yeah and? Accept it and use it to your advantage) my broker spiked the price feed and my stop got hit (what do you expect of the average retail broker you fool, don't put your bloody stops in the obvious places, retailers have no clue where to put stops) And I can go on and on. 100's of post here everyday how everyting is someone elses fault.

This guy lost 150k in a few months, good riddance, maybe that was the cost for him to find out that he sucks at trading. Swallow it and move on, don't go crying to a court, either learn to trade and make it back or bugger of...
  • #96
  • Feb 12, 2011 4:59pm Feb 12, 2011 4:59pm
Quoting M.A.C.Doug

This Law suit has legs I believe
I'm not convinced it does. When it comes to brőkers being counterparty, as I understand it they have to be as no agreement exists between liquidity providers and clients. Sounds logical that they would need to be counterparty in that case.

I think if we looked carefully at brőkers terms of business (which we all agreed to when opening an account) then we'd see how they cover themselves by stating they are counterparty, that they may not offer best price to clients, and basically that they are under no obligation to fill orders at any specific price.

In an OTC market we're at the mercy of the brőker, the only way round that is to make a centralized forex exchange and that's never going to happen.

Conflict of interest naturally exists in these circumstances, the best we can hope for is that brőkers want to keep clients and that they won't take too much advantage of their customers!
  • #97
  • Feb 12, 2011 6:11pm Feb 12, 2011 6:11pm
Ah mutt u beat me to it again!

People you gotta start reading into how this market works, it ain't stocks or anything like that, it's decentralised, unregulated, you name it. End of the day, all firms work on volume somehow or some way or another, learn how they work instead of thinking everything should suit you
  • #98
  • Feb 12, 2011 6:14pm Feb 12, 2011 6:14pm
Quoting M.A.C.Doug
This is true and although it may not make any difference, It means that the broker has alot more conflict of interest than they claim. They claim, they hedge their risk and do not actively trade against their clients and that is a bare faced lie. They keep a book and do not hedge the losing traders and pocket the winnings whilst employing every trick in the book to increase there own odds. CMC markets, a prefered broker on this website were caught and fined doing exactly this. FXCM, GO Markets and others claim to be no dealing desk STP...
The bent part is they get away with it by claiming STP i.e. straight through to another provider, thus technically not keeping orders in-house in one way... but it's simple logic really when you know what the interbank is, i.e. INTER ... BANK lol.....unless you're a bank you don't get that market at all
  • #99
  • Feb 12, 2011 7:31pm Feb 12, 2011 7:31pm
Quoting cloggie
I love these guys though, lose 150k, probably get sh!t from his buddies and his wife, so he's better of blaming and suing his broker then admit his own failure.
yeah I have to agree that you'd have to be pretty stupid to lose that kind of money, but the CFTC invited this kind of stuff with dropping leverage to 50:1.

The small money is drying up / big stupid money comes in and they don't just take a $500-2k loss and walk away.

Nope the big stupid money lawyer's up. One doesn't have to look too hard to find discrepancies with just about any broker. NFA/ CFTC registered means nothing.

At 50:1 trading standard lots you could burn thru 150K quite easily if you don't know what you're doing. So FXCM pays their lawyers the Plaintiffs pays their lawyers and at the end of the day guess who wins?

Lawyers- priceless.
  • #100
  • Feb 12, 2011 7:42pm Feb 12, 2011 7:42pm
Quoting Het2008
WOW! I'm an active user in fxcm, I think it is better to pull my accounts! I don't think anything can stop this fall. The selling volume is increasing on FXCM - NYSE!!!!!!!!!!!!!!!!!!!!!!!!!!
Volume was low and their current price is still around $13 which is at their low end of their yearly range. So yes it does seem there was some selling of stock brought on by this news but overall its still very light selling.
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