Trading Point was just sued by the CFTC for failing to register.
Also, they are in Cyprus.
Cyprus Brokers could be exposed since Cyprus Banks have 40% of their assets in Greece, which in my opinion is quite likely to default on its obligations and pass laws converting all foreign currency deposits to "new drachmas" as a 50% discount. This could include your broker's deposits in the worst case.
I suspect that a lot of the reason for the existence of the large number of Cyprus brokers is that they can earn high interest rates by investing customer funds in Greek banks. They are likely really out for the investment income on the deposits, not for the income from forex trades.
From the FT:
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The Greek crisis has spilled over into Cyprus, raising the risk that a fourth country will soon need an EU bail-out. The islandâs finance minister Kikis Kazamias said he is mulling a request for help from the ECB after 10-year Cypriot bonds rose above 13pc. "We do not have the luxury of being choosy about who is going to lend to us," he said.
While Cyprus is too small to be systemically important, its banking system is roughly nine times GDP with liabilities of â¬156bn, according to Fitch Ratings. This is equivalent to Iceland before it blew up. Cypriot banks have 40pc of their assets in Greece, and hold a significant chunks of Greek debt.
