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Broker reverses $20K winning trades for alleged latency arbitrage

  • #241
  • Oct 30, 2014 8:25am Oct 30, 2014 8:25am
Quoting Abcxyz77
{quote} Yes, this is not the problem about forex.com anymore. It about their brokers rules, there is a guy in forexpeacearmy have similar case with Ironfx, He made 500% profit with a EA name million dollars pips and Ironfx just say it's fraud and set his balance to 0. He reported to FCA and they say Ironfx was right, if the price from these market maker diffrent from bank,big broker like Dukascoppy then they take all of your money following their rules. This is not the problem from forex.com, any broker can do this fxcm,oanda,alpari,citifx,fxpro.......
but all losses cancelled too!
back some years, on a MM/bucket shop broker...I found that MT4 accidentally started to quote GJ 200 pips away from the market.
in about 1 min my account was margin called, and all lost I could blink and realize what is wrong.
it wasn't this much as yunben's loss, "only" 6700$.
with screenshots, support called on phone, after the usual shock, all those trades were cancelled, and my account reinstated back to normal balance. yes, I gave up some meager wins too, but who cared that.

here, the least should be to take the losses from the guy too, not only the wins.

as for the sizes, he must trade some sort of martingale, nothing wrong with that.
as for holding time, non held for seconds only, even the winners aren't.
but in any case, should he arbitrage, what he isn't, you think he would have to use quite big positions to lose to, and would need to lose that much at all if some sure thing is in his hand...ie. for casino example a weighted dice...not.

and if someone don't understand what a script is, then I am sorry. technically when one opens a pending order, it is a script...to make it simple.
there is always, always another trade!!
  • #242
  • Oct 30, 2014 8:28am Oct 30, 2014 8:28am
Quoting Abcxyz77
{quote} Yes, this is not the problem about forex.com anymore. It about their brokers rules, there is a guy in forexpeacearmy have similar case with Ironfx, He made 500% profit with a EA name million dollars pips and Ironfx just say it's fraud and set his balance to 0. He reported to FCA and they say Ironfx was right, if the price from these market maker diffrent from bank,big broker like Dukascoppy then they take all of your money following their rules. This is not the problem from forex.com, any broker can do this fxcm,oanda,alpari,citifx,fxpro.......
If you are right, no losers during that time suit them?
Are you sure there should be no public announcement of price lag after that by them?
Then every broker can do it that way. take easy money from retail traders.
That's a really terrible market!
  • #243
  • Oct 30, 2014 8:35am Oct 30, 2014 8:35am
yunben, don't miss the elephant in the room.
You signed up to trade with a forex broker, so they send their orders to banks/liquidity providers and they charge commissions. They decided NOT to do that but trade against you (rob you by giving fake prices/orders) and they lost.
They try to steal your money, it doesn't work and they accuse you of cheating.

DON'T GIVE UP until forexcom is not out of the SCAMMING business.
  • #244
  • Oct 30, 2014 8:44am Oct 30, 2014 8:44am
I don't know if I am getting this correct :
When a trader makes huge profits ( at least thousands of dollars) every week, then brokers can either say that the orders were not executed completely or maybe executed only partially or there was latency. Under these rules they can deduct all the profits (or maybe deduct losses as well in case profits are much more than losses).
Am I correct???
Striving to Develop & Implement Innovative Ideas
  • #245
  • Oct 30, 2014 8:52am Oct 30, 2014 8:52am
Quoting New-Pragati
I don't know if I am getting this correct : When a trader makes huge profits ( at least thousands of dollars) every week, then brokers can either say that the orders were not executed completely or maybe executed only partially or there was latency. Under these rules they can deduct all the profits (or maybe deduct losses as well in case profits are much more than losses). Am I correct???
yes. it means scalping technique will vanish for all brokers.

Retail traders also have to notice other platform data before trading.
if the platform is lagging, you have to trade with other broker's price.
risk is they may not pay your money back if you lose.
that could be frustrating. right?

how could the regulator think it fair?
  • #246
  • Oct 30, 2014 8:58am Oct 30, 2014 8:58am
Quoting yunben
{quote} yes. it means scalping technique will vanish for all brokers. Retail traders also have to notice other platform data before trading. if the platform is lagging, you have to trade with other broker's price. risk is they may not pay your money back if you lose. that could be frustrating. right? how could the regulator think it fair?
yunben : I am not referring to your case here. I am citing your case as an example. I am very much with you if you check my posts on this thread of yours.
I am asking a general question here Many knowledgeable people here can answer this.
Striving to Develop & Implement Innovative Ideas
  • #247
  • Oct 30, 2014 9:00am Oct 30, 2014 9:00am
Quoting yunben
{quote} If you are right, no losers during that time suit them? Are you sure there should be no public announcement of price lag after that by them? Then every broker can do it that way. take easy money from retail traders. That's a really terrible market!
Yes, it's my wonder too, what about others customers traded at that time? Forex.com probably have 200,000 customers or more, their sever lagged at that time so there must have alot of customers traded at that time. If Forex.com cancelled your profits, they should show the evidence that thay canceled orthers loses too. Yun Ben you should talk to a lawyer and consulting his advices, I believe you can win this case or at least they will be finned. You not do this for your own, the problem is we can't let them rob the next victim, I believe the government should shut down fraud company try to steal their customers
  • #248
  • Edited Oct 31, 2014 8:07am Oct 30, 2014 9:13am | Edited Oct 31, 2014 8:07am
Quoting stewrigh
{quote} Yunben, Are you saying you never use latency or only sometimes?

I would add that from my discussion with the director, they don't have any actual proof whether I trade illegally or not. they just suspect it because I increase trading size and they use bank raw data to adjust the trades because their data is off-market. They think it is fair to me.

although my trades could be in seconds, it is my trading style which is consistent with past trading records. please note my stop loss is higher usually 30-50pips, if I set stop loss also 5-20 pip, losses also can be executed in seconds.


So fellow trader here don't take it as granted that there is any illegal trade they caught, and scold me on it. A broker can do anything you never believe. My case is actually a good live example for you.
ask yourself if you happen to be in my situation, what a broker can do for fair and see what they are doing to me.
  • #249
  • Oct 30, 2014 9:14am Oct 30, 2014 9:14am
Quoting yunben
{quote} yes. it means scalping technique will vanish for all brokers. Retail traders also have to notice other platform data before trading. if the platform is lagging, you have to trade with other broker's price. risk is they may not pay your money back if you lose. that could be frustrating. right? how could the regulator think it fair?
by trading we mean that when we click on buy or sell the trade actually happens and broker uses bank to put trade in market and we are rewarded/punished with results,

if this activity don't happen as we do then that broker is scam and trading is useless with them.

"requote" occurs when platform lags bank refuses to execute trade and we get this msg or we get slippage ,

If platform is lagged then trade should not occur at first place .... if bank has executed it and terminal is showing it occurred broker has no right to cancel it , even if he does it its not fair and ethical.

sooner or later if broker continued that practice they will lose all customer.
  • #250
  • Oct 30, 2014 9:20am Oct 30, 2014 9:20am
Quoting yunben
{quote} From my discussion with the director, they don't have any actual proof that I trade illegally. they just suspect and use raw data to adjust the trades. They think it is fair to me. So fellow trader here don't take it as granted that there is any illegal trade they caught, and scold me on it. My case is actually a good live example for you. ask yourself if you happen to be in my situation, what a broker can do for fair and see what forex.com is doing to me.
Pathetic . penalizing a trader based on doubt and suspicion?
That means in future judges and magistrates will imprison/punish suspects based on doubt and prejudice???? No proofs required?????
Forex.com : get your act correct.
Striving to Develop & Implement Innovative Ideas
  • #251
  • Oct 30, 2014 3:02pm Oct 30, 2014 3:02pm
Forex.com ads all over the place on FF today.
I think they should have said exactly the opposite here:

http://www.forex.com/uk/pricing-exec...advantage.html


Market maker advantage
We are proud to serve our customers as a market maker. We firmly believe this model allows us to deliver the best combination of low trading costs, quality trade executions and great customer service.
Despite what some of our competitors may claim, being a market maker doesn’t mean that we pick and choose which trades to accept, or that our trading desk can adjust the price or the execution speed of your trade. We operate in a highly regulated environment, with strong oversight into trading practices and execution. We quote a price that you can trade, and we execute your trades quickly and accurately, providing a level of price certainty that few brokers can compete with.
  • #252
  • Oct 30, 2014 3:16pm Oct 30, 2014 3:16pm
Good to know:
http://www.nfa.futures.org/news/news...ArticleID=3676

NFA orders $459,000 monetary sanction against New Jersey forex firm Gain Capital Group LLC (Forex.com)

October 28, Chicago - National Futures Association (NFA) has ordered Gain Capital Group LLC (Gain), a forex dealer member located in Bedminster, New Jersey, to pay a $459,000 fine as a result of an NFA Complaint issued and a settlement offer submitted by Gain and its chief executive officer, Glenn H. Stevens.
NFA's Business Conduct Committee alleged that Gain engaged in abusive margin, liquidation and price slippage practices that benefited Gain to the detriment of its customers. The Committee also alleged that Gain failed to maintain records for certain unfilled orders, failed to adequately review the activities and promotional material of the firm's unregistered solicitors, and failed to supervise the firm's operations.
In addition to the fine amount, Gain must also provide appropriate refunds to its customers as a result of these detrimental margin, liquidation and asymmetrical slippage practices.
  • #253
  • Oct 30, 2014 4:18pm Oct 30, 2014 4:18pm
File case document:

5 counts of violations

http://www.nfa.futures.org/basicnet/...px?seqnum=2461

COUNT II

VIOLATION OF NFA COMPLIANCE RULES 2-36(bxl) AND (4), 2-36(c) AND 2-36(e): ENGAGING lN MANIPULATIVE ACTS OR PRACTICES REGARDING PRICES RECEIVED BY CUSTOMERS ON THE METATRADER TRADING PLATFORM; FAILING TO SUPERVISE THE TRADE INTEGRITY OF THE METATRADER PLATFORM TO ENSURE THAT ALL CUSTOMER ORDERS EXPERIENCED SLIPPAGE WHEN PRICES MOVED IN THEIR FAVOR JUST AS OFTEN AS WHEN PRTCES MOVED AGAINST THEM; AND FAILING TO MAINTAIN RECORDS FOR ALL UNFILLED ORDERS PLACED PRIOR TO MAY 2OO9 ON THE
''INSTITUTIONAL SERVER" OF THE METATRADER PLATFORM.

In addition to Gain's weekly practice of routinely adjusting leverage/margin for accounts trading at 200:1 leverage, when Gain anticipated a significant market move over the weekend due to some important weekend event or potential development, Gain further adjusted the leverage for its customers' accounts to 50:1, which increased the margin requirement for these accounts to 2%.

This occurred on three occasions in 2008 and 2009 - on Friday, December 19, 2008, in anticipation of the potential weekend bankruptcy of GM; on Friday, March 13, 2009, in anticipation of a G-20 meeting that was scheduled for the weekend; and on Friday, June 12, 2009, in anticipation of a G-B meeting that was scheduled for the weekend. In all three instances, Gain had ample advance notice of the event in question but failed to provide customers with any advance notice of the margin change.


Most of the positions that Gain liquidated on the aforementioned three dates - in anticipation of adverse market moves over the weekend - would have experienced minimal gains or losses if they had remained open over the weekend instead of being liquidated. However, because of the liquidations that occurred on these dates, affected customers realized overall losses totaling nearly $425,000.
  • #254
  • Oct 30, 2014 4:35pm Oct 30, 2014 4:35pm
Just stay away from bucket-shops who trade against you. Earning commission, spread and mark-up swap are definitely not enough for this type of brokers.

With capital as little as $250 mil simply not enough being a market maker to trade against its clients (clients who can trade).
  • #255
  • Oct 30, 2014 6:04pm Oct 30, 2014 6:04pm
Well, for us, retail traders, it is almost unfeasible to discern sensible and justified broker decisions from mean swindler games...Broker credits profit and pays it out - yeah it is good one, block profit and terminate accounts - undeniably scam object.. IMO, after trying to labour the point of order execution, slippage, LP operation on advanced level, I realized that it is too tangled knot to cut.. not for one month of examination..
I simply put on ice this matter and focused on my trading strategy advancement.
Happy that my Hotforex doesn't engage in this shit and does fair business.
  • #256
  • Oct 30, 2014 7:47pm Oct 30, 2014 7:47pm
forex.con has got their dogs on us.
  • #257
  • Oct 30, 2014 8:04pm Oct 30, 2014 8:04pm
Quoting leebsurag
Well, for us, retail traders, it is almost unfeasible to discern sensible and justified broker decisions from mean swindler games...Broker credits profit and pays it out - yeah it is good one, block profit and terminate accounts - undeniably scam object.. IMO, after trying to labour the point of order execution, slippage, LP operation on advanced level, I realized that it is too tangled knot to cut.. not for one month of examination.. I simply put on ice this matter and focused on my trading strategy advancement. Happy that my Hotforex doesn't engage...
Your broker don't even have Fca,Nfa... You are so brave to trade with this broker
  • #258
  • Oct 31, 2014 1:49am Oct 31, 2014 1:49am
Quoting Ken A
File case document: 5 counts of violations http://www.nfa.futures.org/basicnet/...px?seqnum=2461 COUNT II VIOLATION OF NFA COMPLIANCE RULES 2-36(bxl) AND (4), 2-36(c) AND 2-36(e): ENGAGING lN MANIPULATIVE ACTS OR PRACTICES REGARDING PRICES RECEIVED BY CUSTOMERS ON THE METATRADER TRADING PLATFORM; FAILING TO SUPERVISE THE TRADE INTEGRITY OF THE METATRADER PLATFORM TO ENSURE THAT ALL CUSTOMER ORDERS EXPERIENCED SLIPPAGE WHEN PRICES MOVED IN THEIR FAVOR JUST AS OFTEN AS...
Thanks for posting that link. I find it interesting that, again, the Metatrader platform is an aspect of the situation.
Carbon-Dioxide: the gas of life! https://youtu.be/ttJBdr6eBuo
  • #259
  • Edited 4:28am Oct 31, 2014 2:35am | Edited 4:28am
Quoting yunben
I would add that from my discussion with the director, they don't have any actual proof that I trade illegally. they just suspect and use raw data to adjust the trades because their data is off-market. They think it is fair to me. although my trades could be in seconds, it is my trading style which is consistent with past trading records.
The thing that really stinks about this is that you have used their trading platform to submit open and close orders, and made a substantial profit.
It appears from your post #1 that they have then decided that you were not supposed to make a profit, and took it away from you.

Quoting yunben
So fellow trader here don't take it as granted that there is any illegal trade they caught, and scold me on it. A broker can do anything you never believe. My case is actually a good live example for you. ask yourself if you happen to be in my situation, what a broker can do for fair and see what they are doing to me.
...this I have written before, and yunben you are correct. When you 'sign on' your price feeds and every aspect of trading is what you see before you on the screen. It is within the power of the server software that each and every customer have a different view of the market; that pricing information might be modified for instance when you have an order-close window open and are waiting for the right moment to close a trade. This guy (r.i.p.) has run two machines side-by-side logged into two different accounts on the same broker (a different broker from you), and watched/experienced the variation in behaviour, the deterioration in his main account appeared to occur after he made a withdrawal.....

I have opened accounts with 5 or 6 different brokers in my FX trading career. Each time I have read the entire terms and conditions document to understand exactly what the playing field may be like. This is your play-scape definition.

Guys (and Gals), I have arrived at my working set of basic expectations through experience: if your trading reflects what the charts are telling you, if your trade orders execute as planned or requested, and there is no problem getting money in and out of your account, then you are probably Ok. Otherwise just move on....
Carbon-Dioxide: the gas of life! https://youtu.be/ttJBdr6eBuo
  • #260
  • Oct 31, 2014 3:05am Oct 31, 2014 3:05am
The first page of the OP has been edited by someone.

Bucketshop brokers and bucketshop forums.
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