I read the complain, ratboy. The point is that they generated income out of commissions from their traders, but werent rigistered as B/D. Secondly they allowed unreg. <25k traders to daytrade US stocks and finally they definitely gave more than only 4:1 BP on trader deposits. Obviously enough reasons for the SEC to go against Tuco, no matter traders were considered as retail customers, or not. I'm in the same boat as you, but these are the facts.
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former Tuco traders
- Thread starter ab443
- Start date
I read the complain, ratboy. The point is that they generated income out of commissions from their traders, but werent rigistered as B/D. Secondly they allowed unreg. <25k traders to daytrade US stocks and finally they definitely gave more than only 4:1 BP on trader deposits. Obviously enough reasons for the SEC to go against Tuco, no matter traders were considered as retail customers, or not. I'm in the same boat as you, but these are the facts.
Quote from saico:
I read the complain, ratboy. The point is that they generated income out of commissions from their traders, but werent rigistered as B/D. Secondly they allowed unreg. <25k traders to daytrade US stocks and finally they definitely gave more than only 4:1 BP on trader deposits. Obviously enough reasons for the SEC to go against Tuco, no matter traders were considered as retail customers, or not. I'm in the same boat as you, but these are the facts.
if you read the complaint why can't you cite the law/statute/code that was violated?
I am of the opinion that Tuco was definitely operating in a gray area. But this has done nothing to make it "black and white" This did not go to trial. So basically the SEC charged Tuco with numerous violations, some of which were complete BS. Tuco agreed to stop doing business without admitting or denying anything.
What most firms have done is to stop accepting deposits and requiring a profit split. They are still giving out more than 4-1. If a prop firm doesnt take a deposit, how can the SEC argue they are customers? Without taking a deposit, traders are truly trading the firms capital. If there is a profit split, a true partnership exists. Under these circumstances, a prop firm should be able to give more than 4-1 and mark up trades. I say "should" because the SEC has never come out and clarified their stance on prop trading LLC's. Instead, they are just bullying firms around by charging them with violation knowing that they can't afford to defend themselves.
What most firms have done is to stop accepting deposits and requiring a profit split. They are still giving out more than 4-1. If a prop firm doesnt take a deposit, how can the SEC argue they are customers? Without taking a deposit, traders are truly trading the firms capital. If there is a profit split, a true partnership exists. Under these circumstances, a prop firm should be able to give more than 4-1 and mark up trades. I say "should" because the SEC has never come out and clarified their stance on prop trading LLC's. Instead, they are just bullying firms around by charging them with violation knowing that they can't afford to defend themselves.
let's not forget that Don Bright admits they didn't need s7's till 1999 !!!!
the laws the SEC cite with Tuco are from 1934. anyone starting to smell something fishy here?
go read the laws the SEC uses to charge Tuco with.... they refer to "inducing the public to purchase securities through interstate means."
LMAOOOOOOOOOO... come on .. even idiots like monsterboy know this is a farce.
the laws the SEC cite with Tuco are from 1934. anyone starting to smell something fishy here?
go read the laws the SEC uses to charge Tuco with.... they refer to "inducing the public to purchase securities through interstate means."
LMAOOOOOOOOOO... come on .. even idiots like monsterboy know this is a farce.
Quote from saico:
2 Examples
Section 15(a) of the Securities Exchange Act 15 U.S.C. § 78o (a)
Section 15(b) of the Exchange Act 15 U.S.C. § 78o (b)
LOL... took you long enough.
and section 10.... none of which have anything to do with the Tuco's business model. no one needed 7's till 1999... so what changed?
tuco was acting as an unregulated broker.
after ignoring their business model for years which is similar to others the sec took action.
they were unlucky enough to get in the crosshairs of the SEC.
the remark as to whining stands. people on ET complain for years at length to losses of minimal amounts of money ie undoubtly the worst traders. life is unfair sometimes. you get knocked down. you bounce back by becoming a better trader without a word of complaint about the money.
after ignoring their business model for years which is similar to others the sec took action.
they were unlucky enough to get in the crosshairs of the SEC.
the remark as to whining stands. people on ET complain for years at length to losses of minimal amounts of money ie undoubtly the worst traders. life is unfair sometimes. you get knocked down. you bounce back by becoming a better trader without a word of complaint about the money.
Quote from ratboy88:
not to mention the exchanges will now be able to charge them all appx $400 to $600 a yr just for membership.
then you have testing fees... and continuing education fees. wake up people.. this is a shakedown. [/B]
Boo friggin hoo. it's called part of the dues you pay to be a part of the profession. Everyone who is licensed pays those fees, why should you be exempt?
I pay out the wazoo to be a certified accountant, but I can't complain, I make good money doing what I do. If the exchanges want to charge me more so that I can have other perks that others "Can't", then that's part of the game.
Deal with it, stop your bitching.
Quote from ratboy88:
let's not forget that Don Bright admits they didn't need s7's till 1999 !!!!
the laws the SEC cite with Tuco are from 1934. anyone starting to smell something fishy here?
go read the laws the SEC uses to charge Tuco with.... they refer to "inducing the public to purchase securities through interstate means."
LMAOOOOOOOOOO... come on .. even idiots like monsterboy know this is a farce.
Bright is a REGISTERED broker/dealer, Tuco was not. It's really that simple.
There are laws in this country that if you want to handle/invest the public's money you have to tell the SEC you exist and open your books for random inspection to make sure you are not a ponzi or some other scheme.
Tuco did not register with the SEC but was buying and selling securities. Bright and the others like them register, and have their books examined twice a year by exchange auditors to make sure there is no funny business.
Do you seriously want your money with ANY firm that flaunts the rules by not registering, and could walk away with your funds at any minute because they feel like using them to retire on a beach? Or do you want your funds at a REGISTERED and highly scrutinized firm where you know the people running the firm have had in depth background checks (to join the exchange), are operating legally, have plenty of capital to handle the trading they are doing, and at random times during the year hardcore auditors keep making sure that remains so.
To me the extra $500 a year and piddly test BS are well worth the tons of security that provides. I pay waaay more each year just for insurance on my car and I feel that is nothing compared to the insurance a registered firm provides.