Proposed NFA Capital Requirement

forexsavior · Jul 15, 2008

Weâre Mad as Hell!

And weâre not going to take this anymore! So sayeth the investors of Olint who are pouring onto the Internet in Jamaica to rage against David Smithâs Machine. Here is just a sampling: http://investforlife.wordpress.com/2008/07/14/olint-office-closed/#comments

Have you heard of people phoning-in bomb threats to an airport in order to delay their own flights (because they donât want to miss their plane)? Same thing here, DS knew there would be a massive crowd at his local office today and phone-in the bomb threat!

it is now obvious that OLINT is a ponzi scheme. all this due diligence sh*t has been a farse from day one as when u look at the response from OANDA to the club (whoops PONZI) member it is obvious that he has lost or stolen our money. he must be sue and if necessary sent to jail. i would however he be free and pay us something if possible. LOL NEVER TRUST ANYONE WHO ASKS U TO PRAY FOR A SOLUTION aka Nationwide Interview. DAVID SMITH is a fraud and a spineless *****. Come clean if u are a man

David though u r a honest person you have made drastic errors in regards to the management of Olint. Though i know that u are honest u have caused great pains to club members bucause of your incompetence in management. You should have stick to trading alone and leave the management to person who could do the job. I know we will get paid but i think u deserve 12 lashes

Come clean Mr. Smith. stop propagating rumors, stop passing blame. plain and simpleâ¦. STOP THE LIES!

David Smith it seems that your reputation is important to you. Well sir, you no longer have anything going for you. This last email has broken the camels back. Again you speak without saying anything. YOU ARE FINISHED. Pay the people them what you can, and move on. There are people who will still give you money to trade for them in the future. MOVE ON MAN.

That about sums it up. Pay the people and move on man (of course when you say âmanâ be sure to pronounce man with the proper Jamaican accent.) This is yet another lesson on what can happen to you when you give your money to someone who ainât got no license man.

forexsavior · Jul 15, 2008

Go-Trade Jamaica

Browsing the web I came across this article on a very unique marketing ploy that I Trade FX was using to attract clients in Jamaica last November:
http://www.siliconcaribe.com/2007/1...th-itradefx-in-a-us100-giveaway-to-jamaicans/

Jamaica- David Smith, the Fx Chief of Jamaica, founder of OLINT the premier foreign exchange trading investment club has lent his name to iTrade online forex trading platform with this giveaway. The fullpage, full colour newspaper advertisement and the website says: David Smith is adding US$100 of his own money to Live Forex Trading Accounts for Jamaican Residents who open with iTradeFX between November 15th and December 31st this year at gotradejamaica.com. Of course MTI Traders is all over this, they have been the dominant forex trading educator brand in Jamaica. They have from day one marketed themselves as the company that taught David Smith what he knows. So this giveaway should not be suprising.

Purely, what a powerful affiliate marketing programme !Whoever thought this up, is very intuned with the psyche of the jamaican people has a great timing, itâs very Digicel-esque this offering. The question thatâs been hounding me though is this, are Jamaicans really interested in learninig to trade forex themselves or do they simply want to understand how it works, so as to legitimise, fortify their decision to become investors in forex trading investment clubs. Iâm sure that for every 100 people Market Traders Institute (MTI) trains in their programme, less than 10% actually become forex traders and do so consistently.

David Smith was depositing $100 of his own money into individual I Trade FX accounts? This is highly irregular to say the least and while I have heard of plenty of companies that give signup bonuses to customers I have not heard of individuals doing this for customers.

What it indicates is that Smith was not some passive, minority shareholder in I Trade FX. It sounds like he was pretty involved in the firm judging from this promotion.

forexsavior · Jul 15, 2008

A Scoundrel to the End

Congratulations to the customers of FXLQ who are on the verge of being made whole, an unusually rare occurrence when a forex dealer goes bankrupt. Here is hoping some of that luck rubs off on the poor sods at Olint.

But the customers of FXLQ wonât have Rob Gray to thank, thatâs for sure. At the last second Gray tried to scuttle the Receiverâs plan to have GFT and Ikon buy the customers of this formerly disgraced and dismembered firm.

Gray said âNYET!â to the sale in a formal court objection (someone please explain how Gray is able to strut around in public, and before a court no less, after faking a $35 million bond?)

The Receiver then proceeded to obliterate Gray in court in a rollicking motion filled with such goodies as this: http://www.robbevans.com/pdf/forexlqreplyreceiver01.pdf

In this case, the hearing on the Receiverâs Motion is scheduled for July 14, 2008, and thus, Grayâs Objections should have been filed on or before June 30, 2008. In utter disregard of the Local Rules, Gray waited until 6:11 p.m. on July 3, 2008, to file his Objections and supporting documentation, which totaled approximately 341 pages.

âUtter disregardâ for the rules? Thatâs our Robbie boy!

Throughout Grayâs Objections there is an underlying theme that Gray is âofferingâ to turn over to the receivership estate the sum of $3,000,000 so that all the creditorsâ claims can be paid in fullâ¦

The Receiver views Grayâs âofferâ as nothing more than a hallow promise, as Gray is already duty bound to return these funds to the receivership estate. As is highlighted in the Receiverâs first and second reports previously filed with the Court, the Receiver believes that Gray has misappropriated between $8,000,000 to $11,000,000 of FXLQ fundsâ¦

So where is this mythological $3 million being kept hidden? You donât happen to have a safe house in the Turks & Caicos do you Robbie boy?

Finally, Gray also objects to the Receiverâs proposed sale of the FXLQ office equipment, furniture and fixtures, under the theory that there is no reason to sell such equipment. On the contrary, the Receiver can think of no reason to keep the equipment, fixtures and inventory, as the FXLQ offices are vacant, the business operations of FXLQ have been terminated with no future prospects of an on-going operationâ¦

Ouch. It is finally hitting Robbie boy that FXLQ is DONE. Finished. Kaput. Bereft of life it rests in peace. But he canât let go. One can picture him clinging to the fax machine as a couple surly movers try to haul it out of the office.

But my favorite little nugget has to be this statement found in Ikonâs motion to the court:
http://www.robbevans.com/pdf/forexlqreplyikonglblmkt01.pdf

Mr. Gray never allows the facts to get in the way of a good story.

Mr. Gray proposed to immediately distribute the funds in the customer accounts through IFX Markets Inc. However, as established in the Affidavit of Paul Belogour, attached hereto as Exhibit A, no agreement between Mr. Gray and IFX Markets Inc. to distribute the funds exists.

Taking a quick look at the IFX affidavit Mr. Belogour says:

On July 3, 2008 I had a telephone conversation with Robert Gray of Forex Liquidity. The conversation was brief. Mr. Gray initiated the call and asked me if IFX Markets was interested in the assets of Forex Liquidity. I informed Mr. Gray that IFX Markets would be interested in such a transaction and would request more detailed information if it decided to proceed. I spoke with Robert Gray via telephone again on July 7, 2008 to discuss additional information. On July 9, 2008 I formally informed Robert Gray via email that IFX Markets was not interested in purchasing the assets of Forex Liquidity.

Yet there Robbie boy was telling the court on July 3rd, only a few hours after getting a vague âsure weâre interestedâ shrug of the shoulders from IFX , that IFX markets could be used to distribute customer funds.

Classic Gray. Just keeps on Bullsh*tting them to the end. And it certainly is the end. Oh Robbie boy the pipes, the pipes, are callingâ¦

forexsavior · Jul 16, 2008

The End of Olint
Yesterday the Turks and Caicos Government froze the assets of David Smith and raided his home and place of business. Armed with a search warrant from the Supreme Court the Financial Crimes Unit of the Government swooped into action, grabbing computers, files and other knick knacks as their investigation of him reaches an apparent climax. Radio Jamaica is reporting that in the end Smith could face criminal charges:
http://www.radiojamaica.com/content/view/10004/26/

Worries are growing that the collapse of Olint could have repercussions across Jamaica as the investment scheme is said to have $600 million of Jamaican money tied up in it. Good Grief. Now we are at the point where forex hucksters can crash a nationâs entire economy?

Invest for Life has the full story: http://investforlife.wordpress.com/2008/07/15/olint-assets-frozen/

On a Separate Note: Sources are telling me that the I Trade FX âDavid Smith $100 Bonusâ promotion last winter lasted only a few days before it got shelved. I Trade FX should be releasing their official response to the NFA complaint in the next few weeks.

Stay Tunedâ¦

forexsavior · Jul 17, 2008

The Olint Soap Opera Continues

âI am now indemnifying all the directors and employees as I am the only one that was aware of these activities and I am now at this stage unable to pay out and am making this proposal to you.â â David Smith, per Nationwide News.

It sure is beginning to look like Olint was a Ponzi scheme. A news report is stating that David Smith admitted the following in a leaked email obtained by Nationwide News: http://boomp3.com/listen/1741m06o4_f/olint-broke-provider-investforlife

1. The club is broke and most likely bankrupt
2. The older investors got their money out while the newer investors are the ones âcarrying the losses.â Is that not the very definition of a Ponzi scheme?
3. He overstated his rates of return to club members.
4. The collapse of the fund was due to; competition from competitors, regulatory scrutiny, shoddy bookkeeping.
5. In particular Smith is blaming the Jamaican Government for raiding his company in 2006 as that loss of his records apparently precipitated an accounting fiasco resulting in âdouble paymentsâ to some members. He then states that he didnât report these âdouble paymentsâ to his customers because he was afraid of a bank run which he once again blamed the Jamaican Government for starting.
6. Smith was only trading 50% of the funds while accounting for 100%.
7. He closes stating that Olint was ânot a Ponzi schemeâ and to give him another year to make it all back.

But no sooner had this report been read over the airwaves than David Smith himself called in screaming that he never wrote the email and that it was bogus. Smith said, âI had not written the email. Itâs absolutely not true. And if you really think about it do you think my house is that big that I had to email my own wife?â

So who is to be believed? Well, with David Smithâs credibility in tatters my gut tells me the email is legit. But who knows for certain. What is certain is that Olint is El Busto.

Still, no word of any arrests in the Turks and Caicos. The investigation goes on and there will certainly be more to come.

forexsavior · Jul 17, 2008

David Smith Created I Trade FXâs Platform?

So says this article from the Jamaica Gleaner in December of 2007. As part of the $100 promotion that I Trade FX was offering to Jamaican customers via www.gotradejamaica.com Smith is said to have âcreated the platformâ that customers were using in this promotion, which was in fact I Trade FXâs own platform:
http://www.jamaica-gleaner.com/gleaner/20071207/business/business5.html

The i-Trade FX platform is accessible at GoTradeJamaica.com. The company, which is registered in Florida, describes itself as 'a market maker in the forex market.'

Smith created the platform, the Financial Gleaner was advised, to allow Jamaicans to test for themselves how trading is done and to demystify the element of how such lucrative returns are possible.

The article further states:

David Smith, principal in foreign exchange trading company Olint Corporation, is offering a platform to Jamaicans wishing to learn how to trade currency online.

Smith has offered to each person signing up to i-Trade FX, "$100 of his own money" to help kick-start live foreign exchange accounts, a press advertisement blared Wednesday.
However, each trader signing on to test their mettle must also put up $300 - essentially creating a margin account - and must sign up by December 31 to get the extra $100.
The would-be traders would be required to do a minimum of 10 'round-turn' trades per $100 deposited to their accounts, the ad said.

A round-turn trade essentially requires the trader to execute both a purchase and a sale transaction, or vice versa.

"Clients who request a withdrawal of all account funds without meeting the aforementioned requirement," the ad said, "may not withdraw the deposit giveaway amount."

The more I read about David Smith the more I see the name of I Trade FX popping up. And the more suspicious it looks for I tradeâ¦

forexsavior · Jul 24, 2008

Olint Rumor Mill Keeps Squeezing out the Pulp

Itâs hard to know what to believe about Olint these days with newspaper headlines like this âDavid Smith Alive and Kickingâ courtesy of the Jamaica Observer:
http://www.jamaicaobserver.com/news...38189_OBS__DAVID_SMITH_ALIVE_AND_KICKING_.asp

POLICE in the Turks and Caicos Islands yesterday dismissed rumours that head of beleaguered investment club Olint, David Smith, had attempted to commit suicide by taking a drug overdose.

"He is alive and kicking as far as I know," Sergeant Calvin Chase of the Turks and Caicos police force told the Observer. "We have no such information and I am certainly not aware of it."

So where did these ârumoursâ come from? Who knows. So much about this Olint case is cloaked in secrecy. An email is leaked by an unknown source purportedly written by Smith stating the fund is a shambles forcing Smith to deny it. But later in the week Smithâs own lawyer hints that the email was in fact legit:
http://investforlife.wordpress.com/2008/07/18/olint-broke-email-very-genuine/

Earlier this week Jamaican radio reported that Olintâs accounts at brokers like FXCM, Oanda and FX Solutions have been frozen and that David Smith is being investigated by the Department of Justice for possible money laundering (although none of these firms has gone on the record stating they even have any David Smith accounts at their firms, possibly because of client confidentiality agreements.)

And Government officials in the Turks and Caicos remain tight lipped and unwilling to shed any light on David Smithâs now defunct operation. In such an environment ârumoursâ will take hold. It is time someone in authority in Jamaica or the Turks and Caicos step forward and tell us all what the hell is going on.

forexsavior · Jul 25, 2008

The All Hallowâs Eve Pool Returns

The NFA is on the march. This week they announced that all Forex Dealer Members must meet the first capital benchmark of $10 million by October 31st:
http://www.nfa.futures.org/news/newsNotice.asp?ArticleID=2165

On July 17, 2008, NFA's Executive Committee recommended that NFA's Board of Directors approve revisions to NFA Financial Requirements Section 11 to implement the increased capital requirements called for under the Reauthorization Act. Under these revisions, Forex Dealer Members will be required to maintain adjusted net capital equal to or in excess of $10 million as of October 31, 2008, $15 million as of January 17, 2009, and $20 million as of May 16, 2009. NFA staff expects that the Board of Directors will adopt these revisions at its meeting on August 21, 2008 and that the Commission will approve them shortly thereafter. We are providing advanced notice of the increase in capital requirements to give Forex Dealer Members sufficient time to make arrangements to come into compliance.

In addition to the increase in the required minimum capital, the Executive Committee also recommended that the Board of Directors approve revisions to NFA Financial Requirements Section 12 regarding the collection of security deposits. Section 12(a) requires that Forex Dealer Members collect and maintain minimum security deposits of either 1% or 4% of the notional value of each forex transaction, depending on the currency. Section 12(b) provides an exemption from this requirement for those Members that consistently maintain at least twice the required adjusted net capital. The revised rule would provide that a Forex Dealer Member that consistently maintains 150% of the required adjusted net capital would be exempt from having to collect the prescribed security deposits. As with the capital requirements, NFA staff anticipates this revision also becoming effective on October 31.

How does you firm stack up?

The following firms have net capital below $10 million

Advanced Markets $5,017,000
Bacera $5,387,000
MG Financial $6,001,000
Forex Club $7,380,000
Hotspot $7,843,000
Friedberg Mercantile $8,167,000
CMC $8,426,000
Ikon $8,462,000
MB Trading $8,660,000
Easy Forex $8,662,000
IFX $9,141,000

In particular you will notice that three firms are far below the upcoming increase to $10 million. Advanced Markets, Bacera and Money Garden. In fact, they are struggling just to meet the current $5 million net capital requirement with Advanced Markets a scant $17,000 above the current law. That kind of capitalization does not inspire much confidence and traders really need to beware doing business with them.

The following firms have net capital below $20 million

GFS Forex $10,829,000
Alpari $11, 668,000
ODL $15,182,000
I Trade FX $15,828,000
FX Solutions $18,088,000
CMS Forex $19,306,000

The following firms have net capital above $20 million

PFG $20,275,000
Interbank FX $22,980,000
Gain Capital $44,293,000
GFT Forex $58,304,000
FXCM $70,794,000
Oanda $164,256,000

As always conduct your due diligence and make sure the firm you are trading with will be able to comply with the new law.

forexsavior · Aug 7, 2008

June CFTC Net Capital Report

The CFTC has released its latest Adjusted Net Capital report. With less than three months to go before the NFA raises capital requirements to $10 million the Capital issue is once again front and center in retail forex. How does you firm stack up?
http://www.cftc.gov/marketreports/financialdataforfcms/index.htm

The following firms have net capital below $10 million

Advanced Markets $5,054,000
Bacera $5,361,000
MG Financial $6,086,000
ACM $7,342,000
Hotspot $7,711,000
Friedberg Mercantile $8,189,000
Ikon $8,301,000
Forex Club $8,454,000
CMC $8,729,000
Easy Forex $9,478,000

No change in capital for Advanced Markets, Bacera and Money Garden who are still way below the upcoming cap increase. Also, for the first time ACM is reporting net capital and their first number out of the box isnât that great. One suspects they had no idea cap requirements were going up and it could very well be they have completely mistimed their entry into the U.S. market. ACM appears to have brought a knife to a gun fightâ¦ Typical of a Swiss firm isnât it?

The following firms have net capital below $20 million

GFS Forex $10,909,000
MB Trading $11,165,000
IFX $13,010,000
ODL $13,053,000
Alpari $13,084,000
I Trade FX $16,097,000
FX Solutions $17,974,000
CMS Forex $17,931,000
PFG $19,862,000

The following firms have net capital above $20 million

Interbank FX $30,364,000
Gain Capital $61,918,000
GFT Forex $67,298,000
FXCM $70,792,000
Oanda $165,526,000

As always conduct your due diligence and make sure the firm you are trading with will be able to comply with the new law going into effect in less than three months.

forexsavior · Aug 12, 2008

The Dark Regulator

With the Dark Knight breaking box office records around the world it looks like the CFTC is trying to cash in on the caped crusaderâs popularity. In a recent press release announcing the formation of a âforex fraudâ taskforce the CFTC stated, âThis announcement sends a clear signal that the CFTC is on the beat, and that our continued and increased cooperation with law enforcement authorities will help put these forex dealers where they belong â in jail.â

http://www.cftc.gov/newsroom/enforcementpressreleases/2008/pr5530-08.html

Ya I know many of you are chuckling to yourselves, in classic Joker style, âha, ha, ha, and I thought my jokes were bad.â Forex fraud has been rampant the last couple years and like the hapless gang at the Gotham police department the regulators can never seem to get the bad guys who remain safely tucked away like âLauâ from the Dark Knight hiding out in his Hong Kong skyscraper. Only in the retail forex world the villains sip margaritas on the Turks and Caicos Islands or are busy forging $35 million ABN-Amro bonds in Switzerland.

But maybe there is finally hope here in Gotham. Perhaps the Dark Regulator can save us from the scammers and con-men who are a blight on our wonderful forex world. Letâs hope the CFTCâs new task force scheme works out and that they are able to drive these agents of chaos in the retail forex market out of business once and for all. But then again the Jokers of the retail forex world have never been intimidated by schemes have they?

Joker: Do I really look like a guy with a plan? You know what I am? I'm a dog chasing cars. I wouldn't know what to do with one if I caught it! You know, I just, do things. The mob has plans, the cops have plans, Gordon's got plans. You know, they're schemers. Schemers trying to control their worlds. I'm not a schemer. I try to show the schemers how, pathetic, their attempts to control things really are.

So to the folks at CFTC, please, make sure this latest scheme doesnât draw the kind of ridicule the Joker loves to heap on law enforcementâ¦