CFTC Sues 11 More Forex Companies

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The companies are sued under the 2008 Farm Bill, the Dodd-Frank Act and the CFTC’s regulations. The 11 new lawsuits join 14 previous ones, making the total number 25. 

Some of the firms are based in the US, while others are from the British Virgin Islands, Belize, the UK, Australia and Cyprus. Here are their names:

  1. 1st Investment Management, LLC, a Wyoming LLC;
  2. City Credit Capital, (UK) Ltd., a United Kingdom company;
  3. Enfinium Pty Ltd., an Australian company;
  4. GBFX, LLC, a New York LLC;
  5. Gold & Bennett, LLC, a New York LLC;
  6. InterForex, Inc., a British Virgin Islands company;
  7. Lucid Financial, Inc., a Utah corporation;
  8. MF Financial, Ltd., a Belize company with offices in New York City;
  9. O.C.M. Online Capital Markets Limited, a British Virgin Islands company
  10. Trading Point of Financial Instruments Ltd. a Cyprus company; and
  11. Windsor Brokers, Ltd., a Cyprus company.

The official goal of the lawsuits is to make the forex market safer for investors. This enforces the regulations that took effect in October 2010, which caught attention mostly due to the 50:1 leverage limits.

In 9 out of 11 cases, the CFTC claims that the brokers traded against the clients. In the other two, the brokers are blamed for not being registered as Introducing Brokers. The CFTC’s complaints seek civil monetary penalties, trading and registration bans, disgorgement, and rescission.

The previous 14 cases, which were filed in January, most of the companies reached a settlement or defaulted. The remaining three lawsuits are still pending.

More from the official press release can be found here.

What do you think?

Are you trading with one of the companies listed above?

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About Author

Yohay Elam – Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I’ve accumulated. After taking a short course about forex. Like many forex traders, I’ve earned the significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I’ve worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.

12 Comments

  1. Wow… Thank GOD I’m not in one of them..
    usefull arcticle.. Many thanks..

  2. All brokers are businesses, and in it to make a profit. No different to Governments or Banks. So makes me wonder in whose interest this legislation is? They are not ripping of Countries and businesses by the Billion are they. Neither do they ask for Bailouts for bad business management…….. So given that all businesses are guilty of some sort of profit making, how useful is this article?

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  4. If there trading against the people who have accounts with them, then their taking advantage of their account holders. Its like a ponzi scheme. The difference is they use their own clients money against them.

  5. Dodd-Frank bill has put a strangle hold on free market enterprise and the capital spirit so many Americans take part in to grow the monetary system of the US. We will take that bill and tear it down the middle in the next election. No more regulations from those trying to protect us unknowing US citizens, poppy cock! I am a big boy, I push the button to buy then I can push the button to sell!

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  7. Chris Zacharia on

    Trading Point of Financial instruments is aware of the September 8th complaint by CFTC for failure to register according to the new legislation. The complaint has yet to be officially served to Trading Point, however the management and legal team of the company are fully aware of the issue and will be in communication with the CFTC staff to speedily resolve the matter.

    Trading Point of Financial Instruments is a European regulated company licensed by CYSEC and in strict compliance with the Markets in Financial Instruments Directive 2004/39/EC (known as “MiFID”).

    MIFID is the European Union law that provides harmonized regulation for investment firms across the 30 member states of the European Economic Area. The main objectives of the Directive are to increase competition and consumer protection in investment service.

    The key aspects of MiFID are to ensure amongst others: Authorization, regulation and pass-porting, client categorization, client order handling, pre-trade transparency, post-trade transparency, best execution and Systematic Internaliser.

    MIFID consumer protection regulation is by no means inferior to any non EU equivalent. Moreover the EU directive respects the rights of any responsible trader to trade under the conditions he chooses as long as the substantial risks of financial loss are clearly made known to him.

    Trading Point prides itself on its reputation for having the client’s best interests as its cornerstone. The company respects and does its best to be in line with the laws of every country.

    Finally we want to reassure everyone that the complaint of CFTC for failure to register will be resolved and it does not in any way affect the everyday operations of the company.

  8. Chris Zacharia on

    Official Response – Trading Point of Financial Instruments

    Trading Point of Financial instruments is aware of the September 8th complaint by CFTC for failure to register according to the new legislation. The complaint has yet to be officially served to Trading Point, however the management and legal team of the company are fully aware of the issue and will be in communication with the CFTC staff to speedily resolve the matter.

    Trading Point of Financial Instruments is a European regulated company licensed by CYSEC and in strict compliance with the Markets in Financial Instruments Directive 2004/39/EC (known as “MiFID”). MIFID is the European Union law that provides harmonized regulation for investment firms across the 30 member states of the European Economic Area. The main objectives of the Directive are to increase competition and consumer protection in investment service. The key aspects of MiFID are to ensure amongst others: Authorization, regulation and pass-porting, client categorization, client order handling, pre-trade transparency, post-trade transparency, best execution and Systematic Internaliser.

    MIFID consumer protection regulation is by no means inferior to any non EU equivalent. Moreover the EU directive respects the rights of any responsible trader to trade under the conditions he chooses as long as the substantial risks of financial loss are clearly made known to him.

    Trading Point prides itself on its reputation for having the client’s best interests as its cornerstone. The company respects and does its best to be in line with the laws of every country.

    Finally we want to reassure everyone that the complaint of CFTC for failure to register will be resolved and it does not in any way affect the everyday operations of the company.

    Official Response – Trading Point of Financial Instruments

  9. Jonathan Az on

    50 to 1 leverage was suppose to keep the investor from loosing vast sums of money..BULL..Now it takes twice as much money in the brokerage account to trade. Obama signed Dodd/Frank with no knowledge of forex.( seems he has NO economic knowledge anywhere ) It is no wonder that ALL of Obamas economic advisers quit. The government will not allow investing in foreign forex. This is the ONLY country that has that rule and also the only one with 50/1. The CFTC is turning a blind eye to banks and wall street bnusiness as usual and thriving..SO they come after forex to make it seem like Dodd/Frank is working. It is not..also there is one brokerage firm that will accept USA investors. This means??NZD/USD and NZD/JPY made me (sept 7-9) alot richer with less investment and the profit came in to my bank on Friday. Can’t say the name, you’ll have to hunt..but it sounds like a lawnmower.

  10. What a bunch of Jerks… they think making things safe to reduce leverage at 50:1 or 10:1 is going to solve things?

    Here’s an idea…

    LEARN HOW TO TRADE PROPERLY AND YOU WONT LOSE YOUR MONEY!

    Simple.

  11. Tom Strignano on

    Lets See, I can go to Vegas and Bet the farm on 36 Black…But I can t trade Forex … to dangerous… Tell The government to F*#k Off..