Brokers chasing you for negative account balance | Page 30 | Forex Factory

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Brokers chasing you for negative account balance

  • #581
  • Feb 15, 2015 6:47am Feb 15, 2015 6:47am
Quoting rythmrig
Suspending trading [..] is evident enough of fraudulent behaviour. It's simple and keep it simple. No excuses
You are right, by suspending trading and enabling it again at 0.85 for EUR/CHF, anybody using a leverage of more than 1:3.5 got 100% wiped out and ended with a negative balance. And that's with an entry at exactly 1.20. No choice, nothing that you could do. All this with the market makers being the only counterpart of all the trades.

But you will still find people telling you that it's 100% the traders fault, amazing. Such persons are either paid or have an incentive to write that or they are so stupid I don't want to discuss with them at all anymore.
  • #582
  • Feb 15, 2015 8:53am Feb 15, 2015 8:53am
Locking you out of the room why stabbing you in the back and you cannot defend your self is a low act. The same locking you out of access to your trading account or a particular pair with no control on the outcome is low. A failed margin call of 20% on there side of the clients account is low. Then using massive slippage as they call it on top of all that was kicking you why you are down. Then to ask client's to refund the losses are laughable and are an act of pissing all over you why there kicking you and your laying down. There guilty of theft and there systems implemented to protect 20% of an account failed. Failed purposely to steal money from there clients accounts. Don't fall for the slippage bullshit either.
  • #583
  • Feb 15, 2015 10:30am Feb 15, 2015 10:30am
Just found this from FXPro CEO (its one paragraph from an interview

One thing I would personally like to see is for regulators to start looking a little closer at the way market makers execute orders, especially during such volatile conditions. According to our calculations there was more than enough time for them to fill their clients’ stops at or around 1.18, which means that a significant amount of unnecessary negative slippage was passed on. If the move had gone the other way would they have passed on the positive slippage? Or would they have just filled orders at the declared price? I think we all know the answer to that question. -

See more at: http://forexmagnates.com/fxpro-ceo-d....CS6MPLPA.dpuf
  • #584
  • Feb 15, 2015 3:01pm Feb 15, 2015 3:01pm
Quoting maokun
Spread bet debt is enforceable by law. {quote}
All debt is enforceable by law. The misunderstanding most people have is that they mistakenly think that a contract with a broker showing negative balance is a debt. It's not, it's a claim that could be a debt if you agree with it or a court agrees with it.
  • #585
  • Feb 15, 2015 3:10pm Feb 15, 2015 3:10pm
Quoting wookey
{quote} ​It is not so rosy as this person pictures it. Obviously KPMG will go to English court. and try to obtain European Enforcement Order (EEO). Once the EEO certificate is issued the judgment is treated as if it had been delivered by the court of the enforcing member state. Now a debtor can avoid being issued an EEO, but they have to do it in the English court. It is not very difficult, consult your lawyer of how to do it. However, even if you avoid being issued EEO, KPMG will still be able to obtain the court confirmation of your debt...
I just did some research and neither an EEO nor the Brussels Convention can be used in relation to insolvency process. KPMG can and will be able to enforce uncontested debt, but not negative balances where the trader does not agree to it.

I am also highly doubtful that KPMG/Alpari can sue in court for establishing debts after the time insolvency, because an insolvent company is judgement proof and can't be countersued. Otherwise I could start 2 companies, make one insolvent to the other and then go sue everyone else in the world without worrying about being countersued.
  • #586
  • Feb 15, 2015 4:09pm Feb 15, 2015 4:09pm
After some research, I think I understand why most brokers chose to forgive negative balances: financial regulations.

From what I read, according to finacial regulations (EU & US) brokers / dealers have to make sure that their financial instruments are "suitable" for you as an individual retail client. In other words, they (brokers) have to protect you from financial instruments that are not suitable for you, hence all the warnings.

I think it can be easily argued that if a financial instrument causes within a few minutes, not only a total account loss, but the trader owing substantially more, then the financial instrument was NOT suitable. I believe that any regulated broker that would sue a retail client for negative balance would not only have to prove that the trader has a debt, but also show that the financial instrument was suitable for this individual. Very difficult to do, IMO.

I'm not arguing the morality, just this is what regulations say and why I believe that we probably won't be seeing many lawsuits against retail traders for negative balances.
  • #587
  • Feb 15, 2015 4:22pm Feb 15, 2015 4:22pm
Quoting Silver777
After some research, I think I understand why most brokers chose to forgive negative balances: financial regulations. From what I read, according to finacial regulations (EU & US) brokers / dealers have to make sure that their financial instruments are "suitable" for you as an individual retail client. In other words, they (brokers) have to protect you from financial instruments that are not suitable for you, hence all the warnings. I think it can be easily argued that if a financial instrument causes within a few minutes, not only a total account...
And this is WHY they are only going after the high net worth clients and the very profitable traders for the negative balances because with them, they can clearly show the forex IS a "suitable" instrument for them and if they still owed negative balance amount, then the brokers think they have a freer rein to go after them.
Make your losses in demo. Earn your profits live.
  • #588
  • Feb 15, 2015 4:24pm Feb 15, 2015 4:24pm
Quoting Silver777
{quote} All debt is enforceable by law. The misunderstanding most people have is that they mistakenly think that a contract with a broker showing negative balance is a debt. It's not, it's a claim that could be a debt if you agree with it or a court agrees with it.
100% right, the broker has to demonstrate in court their claim and have the trader condamned to pay it.
Undoable imo, and very unlikely they even try it.

Quoting Silver
KPMG/Alpari can sue in court
That's wrong. A company in liquidation can sue.
  • #589
  • Edited 8:18pm Feb 15, 2015 5:29pm | Edited 8:18pm
I believe that no negative protection needs to be a key essence in all Brokers. This ensures that the brokers themselves do not expose their clients to undue risk as with the Swiss bomb of 15 Jan 2015. As such brokers would either not allow trade on pegged /floored currencies or only allow trades against the floor or peg.

The ones to blame for the huge losses are the liquidity providers as they stopped giving liquidity which is their job and brokers themselves for not taking extreme risk protection measures. (I wonder what would happen if the Swiss reserve bank lets go of the floor? Hmmm)

And lets not forget the massive conflicts of interest. How many liquidity providers own shares in brokers? This is the biggest scam of the century in terms of how some major players made a killing. And shafted ordinary people of their savings or entire fortune. Reeks of a setup for massive profits!

Sign up for the petition to fight this loss being passed on to retail traders there is a lot of crooked stuff going on here with the execution prices:
https://www.change.org/p/tracey-mcde...ting-companies

FxPro Ceo is onto it with the executions by market makers is a scam!!
- See more at: http://forexmagnates.com/fxpro-ceo-discusses-leverage-agency-model-prospects-snb-crisis
  • #590
  • Feb 16, 2015 2:16am Feb 16, 2015 2:16am
Quoting Halifax
Buddy1's vendetta against Pepperstone got me thinking so I looked in to the IC markets staff list. The founder and managing director of IC markets is Andrew Budzinski as in buddy1. Buddy isn't exactly a common name, especially in Australia and this poster seems to have a sole purpose in bringing down Pepperstone's reputation. Who else would be such a massive fan of IC markets, defending them at every opportunity while trying to smear their biggest competitor - Pepperstone - who gets all the media coverage here. Would be pretty poor form and explosive...
Imagine my surprise that buddy1 has been banned for having an additional user-name, and his thread to bash Pepperstone locked for being allegations of a competing broker:

http://www.forexfactory.com/showthread.php?t=524831

Talk about a sickening marketing campaign.

I wish brokers would be constructive rather than attacking each other. Surely there could be some co-operation between them rather than underhanded mud-slinging and planted forum trolls.

How can we ever know what is fact or just a paid marketing smear campaign?
"Don't Panic..."
  • #591
  • Feb 16, 2015 2:51am Feb 16, 2015 2:51am
Quoting Mevo
{quote} 100% right, the broker has to demonstrate in court their claim and have the trader condamned to pay it. Undoable imo, and very unlikely they even try it. {quote} That's wrong. A company in liquidation can sue.
Mevo, you are right, I stand corrected, a company in liquidation can sue.

However there are limitations and in regards to my previous comment about insolvent companies being judgement proof:
I read that if an insolvent company wants to sue in court, they have to secure proceeds / assets / collateral in advance before the trial to pay the other party in case they lose.

So from my understanding, if Alpari / KPMG want to go after say the 9 large clients who have more than half the negative balances, first all of the creditors will need to agree with this strategy and then they will need to put up collateral / cash up front to pay the defendants in case they lose. Not only this, but if I understood correctly, EEO and the Brussels Convention can not be used since Alpari is insolvent so it will need to be done in the defendants' home countries, where Alpari will have to open all of its trading records, the good, bad and the ugly to prove their executions (past and present) were fairly executed.

Wow, talk about an uphill climb! I agree Mevo, it seems a very unlikely scenario.
  • #592
  • Feb 16, 2015 2:59am Feb 16, 2015 2:59am
Quoting Forexia
{quote} And this is WHY they are only going after the high net worth clients and the very profitable traders for the negative balances because with them, they can clearly show the forex IS a "suitable" instrument for them and if they still owed negative balance amount, then the brokers think they have a freer rein to go after them.
Yes, I agree Forexia.

Hmmm...... this got me thinking..... I wonder if we will see lawsuits from retail traders who lost their life's savings to their brokers for NOT protecting them from "unsuitable" instruments?

I feel for those have gotten hit with huge losses, hope they get professional help to find out all of their options.
  • #593
  • Feb 16, 2015 11:21am Feb 16, 2015 11:21am
Negative balance, sign up:

https://www.change.org/p/tracey-mcde...ting-companies
  • #594
  • Feb 16, 2015 11:50am Feb 16, 2015 11:50am
The Press release announcement from IC Markets regarding covering the negative balances had not been effective for me. I'm being a victim of persecution by IC Markets because negative balance.

Although I am well protected and with a solid defense, any help will be greatly appreciated.
  • #595
  • Feb 16, 2015 1:08pm Feb 16, 2015 1:08pm
... and one more...
http://epetitions.direct.gov.uk/petitions/74689
  • #596
  • Feb 16, 2015 3:09pm Feb 16, 2015 3:09pm
If you are a Swiss citizen and have sustained a significant loss, you can send a written a complaint to the FINMA (swiss regulators) using the following link:

https://www.finma.ch/e/Pages/Kontakt.aspx

I draft a complaint against Swissquote. More the complaints, more chances they will investigate the brokers and their practices. I find it disgusting how they go fish for retail clients on Facebook or similar sites, lie about limited loss to initial investment, and then take no responsibility when such a crash happens.
  • #597
  • Feb 16, 2015 4:36pm Feb 16, 2015 4:36pm
Quoting Silver777
{quote} Yes, I agree Forexia. Hmmm...... this got me thinking..... I wonder if we will see lawsuits from retail traders who lost their life's savings to their brokers for NOT protecting them from "unsuitable" instruments? I feel for those have gotten hit with huge losses, hope they get professional help to find out all of their options.
Well considering that they lost their life savings so they wouldn't be in any positions to try launch any lawsuits soon, not financially anyway. And for those who were able to obtain pro bono representations from some over-zealous lawyers, they wouldn't win. The fiduciary duties of any brokers/advisors only operates under the circumstances that the clients themselves have taken reasonable precautions using reasonable judgement in exercising their investment decisions in whether to invest or not trade. They cannot expect the brokers/advisors to basically make every single decision, that would be placing undue hardship on the brokers/advisors and that is NOT going to fly with any judges in any court. NOW IF that investor has lost its life savings due to price manipulations by the liquidity "providers" and/or the brokers, e.g. having had trades executed with prices that was completely fabricated that is absolutely not supported or evidenced in the market, then he/she would have a case. He/she has exercised reasonable care and precaution in managing his/her investment but due to the unscrupulous action of others in the form of securities fraud in the form of disruption of market and price manipulation, the value of his/her investment had grossly and artificially and unduly deteriorated to the point that it erased his/her entire life saving.
Make your losses in demo. Earn your profits live.
  • #598
  • Feb 17, 2015 1:35am Feb 17, 2015 1:35am
There is a potential class action against Saxo in Denmark:

http://www.andersen-partners.dk/en/content/645

10. February 2015

Andersen Partners represent clients against Saxo Bank

Andersen Partners have been contacted by a larger group of Saxo Bank clients who had invested in Swiss franc, when the Swiss National Bank discontinued the minimum exchange rate for the Swiss franc against the euro on 15 January 2015.
The group of clients, which consists of both Danish and foreign members, has asked Andersen Partners to represent the members in a potential class action lawsuit against Saxo Bank regarding i.a. the lawfulness of Saxo Bank's adjustment of their clients' transaction prices after the transactions were concluded.
Andersen Partners are currently collecting and reviewing material from the Saxo Bank clients who have already contacted us.
In case other Saxo Bank clients consider taking part in a potential class action lawsuit, please do not hesitate to contact Mr. Jakob Ravnsbo, Lawyer or Mr. Søren Stig Hansen, Lawyer.
  • #599
  • Feb 17, 2015 2:48am Feb 17, 2015 2:48am
This Topic clearly shows there are traders in FX who should NOT be in this business at all....
Forex is a losers game.
  • #600
  • Feb 17, 2015 3:02am Feb 17, 2015 3:02am
To some of the Saxobank clients, there is a Saxo Bank Cheated Users Group: http://sbcug.yolasite.com/

Quote
We are a group of people who were cheated by Saxo Bank. We all have the same problem with the EUR/CHF and other CHF positions. We created this group because we want to form a big number of people in order to be stronger and share the costs of the law firm for the trial. Then if you would to join our group you should know that we will share the cost of the lawyers and our common goal is to ask for one simple thing. We want Saxo Bank to return our accounts into the account balance before the re-quote. We don't accept the re-quoted rate. And of course...
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