Proposed NFA Capital Requirement

You are correct, but you fail tol mention that over 95% of the complaints come from those who are well funded e.g. FXCM .
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Can any operator compare from complaints
point of view well funded fx companies

FXCM,GFT,FXSOL,OANDA,IBKR

and technology leaders as

MBT and HotspotFX .Each with some 6 mln $ only ...

Relevant comment would appreciated
 
Quote from Paliz:

You are correct, but you fail tol mention that over 95% of the complaints come from those who are well funded e.g. FXCM .
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That is a silly statement. The NFA has publically stated the problems in the fx industry are due to poorly capitalized firms not well capitalized firms. You have no statistics to back up such a claim.
 
NFA Fines AMIFX

Advanced Markets just got nailed for shoddy book keeping. Here is the the NFA's official statement:

NFA fines Charlotte forex firm, Advanced Markets, Inc., and its principals $150,000

January 30, Chicago - National Futures Association (NFA) has ordered Advanced Markets, Inc. (AMI) and its principals, Anthony P. Brocco and Geoffrey Gooch, to jointly pay a fine of $150,000. AMI is a Futures Commission Merchant and a Forex Dealer Member located in Charlotte, North Carolina. The Decision, issued by an NFA Hearing Panel, is based on a Complaint filed in June 2007 and a settlement offer submitted by AMI, Brocco and Gooch.

The Panel found that Brocco and Gooch failed to diligently supervise the firm's financial and recordkeeping activities and the promotional materials used by AMI's unregistered solicitors.
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Call Your Congressman!

2007 was a year of change in the forex industry, most of it for the better as some of the seedist firms in the industry were shown the door thanks to the NFA’s capital requirement increase. But 2008 appears to be an even more momentous year of change for the U.S. forex industry. And those changes may not necessarily be for the better.

The Savior has long been an advocate of healthy capitalization in the industry. But the recent legislation set to pass in the Congress should be a cause for serious concern for all forex traders. The last few weeks I have received numerous emails and done some research through helpful links provided on the bulletin boards and have come to the realization that this legislation is not good for the trading public.

Wha? I know, I know. The Savior has been preaching the virtues of high capitalization so in theory he should support increasing capitalization to $20 million right? And in fact at first I was sympathetic to this proposal. But the bottom line is the Savior is also a trader. And as a trader I am worried that by restricting this industry to just a handful of the larger players (FXCM, GFT, Gain, Oanda) that speads will once again widen. Take FXCM for example. Their spreads have been tightening for the past year in response to the increased competition taking place in the marketplace. But what happens if that competition gets eliminated altogether? How does this affect the average trader?

The $5 million rule needed to be put into place. There were too many tiny bucketshops doing serious damage to traders. Even now I still have my suspicions about tiny little outfits like AMIFX who are barely treading water even after the $5 million requirement.

Nevertheless, with the House already passing a law to require that all firms have a minimum $20 million on hand (and who knows what other capital requirements will be imposed upon the industry) the barrier to entry is getting sky high and few firms are going to be able to make the cut. My understanding is that the Senate has not approved the House’s language. So there may still be a chance to stop this law from passing.

Also it appears that introducing brokers are going to be wiped out entirely. There are a bunch of registration requirements that may very well strangle most introducing brokers and put them out of business.

I don’t think people realize just how perilous the situation is. This could all become law in a month’s time. Traders, brokers and medium sized dealers should call their Congressman right away. It seems Congress is only hearing from the regulators, not the general public. As a trader I want a healthy industry with stable, well capitalized firms. But I also want good service and tight spreads. Having only 6 firms in the industry is not going to guarantee either.
 
The $20 Million Dollar Guillotine

Should the Congress pass legislation requiring all firms have a minimum net capital requirement of $20 million the following firms will be in danger in the United States:

Advanced Markets $1.3 million
Alpari $6.4 million
Bacera $3.1 million
CMC $2.7 million
CMS $11.4 million
Easy Forex $7 million
Forex Club $4.8 million
Friedberg Mercantile $7.9 million
GFS Futures & Forex $3.6 million
Hotspot $6.1 million
IFX $17.1 million
Ikon $9.1 million
MB Trading $6.6 million
Money Garden $5.3 million
ODL $13 million
PFG $12.8 million

Now, many of these firms have additional capital they can infuse into their firms (particularly foreign firms like IFX and CMC as well as domestic ones like Hotspot.) But many do not. The customers of these firms should take notice, and if you want to keep trading with these firms, take action.
 
Quote from forexsavior:

That is a silly statement. The NFA has publically stated the problems in the fx industry are due to poorly capitalized firms not well capitalized firms. You have no statistics to back up such a claim.
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An equally valid issue is the "well capitalized" brokers being charged with, according to the NFA website ...

• C.R.2-36(b)(1) - CHEAT, DEFRAUD, DECEIVE FOREX CUSTOMERS
(http://www.nfa.futures.org/BasicNet...spx?seqnum=1023)

Based on that it seems customers have an equally great risk of being screwed by a "well capitalized" broker.

http://www.nfa.futures.org/BasicNet...046&contrib=NFA
 
Just found proof that IBFX has been not exactly truthful in regards to their relationship with FXLQ, read this tidbit we found at FXstreet.



"What more proof do we need ,, LOL wow IBFX are outright deceiving us all this time trying to distance themselves from FXLQ No we have no relationship. What a bunch of phonies, Karma Todd you had this one and what’s coming, coming for a while. You and Mr,Gray deserve it.

http://www.robbevans.com/pdf/forexlqreport01.pdf

Read page 6 of this doc, clearly they can’t deny these facts any longer

I would run, no walk, run forest run these lyres’
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"
 
Seems like Mr., forexsavior dancing to a new beat this time around, could it be that the firm you started all this propaganda for may not qualify under the new guidelines themselves? Sure the hell looks that way!!! I’ve seen plenty of other forums members with my same views, your loosing credibility now.

Remember this time around it’s not just how well capitalized a firm is, this new bill makes sure all FX retail firm s are properly licensed and overseen http://www.elitetrader.com/vb/showthread.php?s=&threadid=114662
 
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