Proposed NFA Capital Requirement - page 26
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As a trader with Velocity4x, this does raise some questions. The notice indicates that the transition from Velocity4x to Forex.com (Gain Capital, LLC) will be as transparent as possible.
In anticipation of something unpleasant happening, I successfully withdrew most, but not all, of my funds from my Velocity4x account a few days ago. It will be refunded when I have confidence in the new arrangement and am ready to trade again.
I assume this means that Metatrader can continue to be used as before. But I could not find support for Metrader on the Forex.com website.
Also, does anyone know what the capitalization of Gain Capital is (or how one can find it)?
The Final Countdown
Queue up the music from Swedish Glam Band "Europe" because this week is when the Dead Pool comes to an end. YouTube - Europe-The Final Countdown
This Friday is the NFA deadline for fx firms to meet the minimum $5 million capital requirement. Two updates to report:
GFS Futures & Forex has just made an announcement on their website that they have received a $6 million capital infusion to put them over $10 million thus ensuring a stay of execution from the NFA hangman.
Meanwhile, Velocity4x has thrown in the towel and is handing over their clients to Gain Capital.
December 14, 2007
Dear Valued Customer:
In an effort to better serve the needs of our customers, Velocity4x is pleased to announce a new partnership with FOREX.com, a division of GAIN Capital Group. Effective Friday, December 14, 2007 at 5:00 pm ET Velocity4x will transfer all customer accounts to FOREX.com. Following the transfer of your account, FOREX.com will provide all custody, clearing and support functions.
FOREX.com has worked closely with Velocity4x to ensure the transfer of your trading account is as seamless as possible. You may continue to access the trading platform as you have in the past and utilize your existing login and password.
Trading activity in your account after December 14, 2007 will confirm your consent to be bound by the FOREX.com Customer Agreement. A link to the FOREX.com Customer Agreement is provided here for your convenience: Click here to view the FOREX.com Customer Agreement.
If you choose to close your account following the transfer, you may communicate your decision to FOREX.com directly, through email at velocity4x@forex.com or telephone at 908.458.8274 and FOREX.com will honor your request and return your account balance to you.
If you have any questions regarding this transfer you may contact Velocity4x at 312.546.6288 or via e-mail at accounts@velocity4x.com or FOREX.com at 908.458.8274 or via e-mail at velocity4x@forex.com.
Through our new relationship with FOREX.com, we look forward to providing you with superior service. FOREX.com is a registered Futures Commission Merchant and a member of the National Futures Association (NFA ID# 0339826). You may also obtain additional information regarding FOREX.com and Gain Capital Group, LLC on NFA's web site.GAIN Capital's corporate headquarter address is 550 Hills Drive, Bedminster, NJ07921 and its main telephone number is 908.731.0750.
Very Truly Yours,
Velocity4x
The following firms have still not publically indicated they have met the requirement. Beware these firms until further notice:
1) SNC Investments: $1,152,000
They are well below the $5 million capital requirement. It is highly unlikely they will make the new requirement at this point. I advise customers to leave this firm and look for greener pastures.
2) Wall Street Derivatives: $1,228,000
This firm is based out of New Zealand and I'm not even sure they have any U.S. customers as their U.S. website is out of service.
3) Advanced Markets: $1,322,000
Amifx is already teetering on the brink as they are the subject of a business conduct committee case before the NFA in which they are cited for a whole host of financial violations including not meeting the old capital requirement. This firm does not have much of a future.
4) AlpariFX $2,481,000
Little known European firm. Well under the cap requirement.
5) Solid Gold Financial: $2,040,000
Solid Gold's future is now in serious doubt. Like many of the other firms on this list they have been charged by the NFA with failing to meet their existing capital requirement. When you can't meet the old requirement it stands to reason you won't be able to meet the new one either. Solid Gold is anything but a solid investment at this point.
6) Bacera Corporation: $2,300,000
Like a turd that won't flush Bacera Corporation just refuses to go down the drain. The Savior wrote Bacera off over the summer as sources knowledgeable about them stated they were going to close up shop. But no, they are still hustling the folks in LA for fresh deposits. In September Bacera settled a complaint with the NFA after it was discovered they were undercapitalized to the tune of $1.2 million. NFA reported Bacera only has about 200 customers as it is. But to those 200, do yourself a favor and get yourself another broker because sooner or later the pipes are gonna get cleaned and these guys are going to get flushed once and for all.
7) ODL Securities: $2,566,000
Ravaged by undercapitalization issues.
8) Forex Club: $3,320,000
They still have not hit the minimum $5 million mark. And don't forget since they are a market maker they have other financial requirements to meet as well. They still haven't publically done so.
9) Easy Forex: $3,789,000
Under siege for their sleazy sales tactics, it's hard to imagine the NFA isn't going to drop the hammer on them soon.
10) Money Garden: $5,035,000
While they have crept up over the $5 million mark MG is notorious for their 400:1 "flexi" accounts which will require MG put up a minimum $10 million in capital in addition to other financial requirements for being a market maker. They are not even close to doing this despite their CEO's insistence they could easily get the money last summer. It looks like this veteran of the industry is about to be forcibly retired.
CFTC Raids One World Forex
Well the CFTC has officially stepped in to put an end to the shenanigans at One World Capital. I have been reporting on the decline and fall of One World Capital for over six months now so this should be no surprise to anyone following this thread. But it appears that there is a serious shortage of funds at One World which is going to result in heavy losses for customers. This is exactly what I have been warning about for several months now.
CFTC Sues One World Capital Group, LLC and its President John Edward Walsh for Inability to Demonstrate it had Required Capital
CFTC Sues Forex Dealer One World Capital Group, LLC and Its President John Edward Walsh for Inability to Demonstrate it had Required Capital
Winnetka, Illinois Forex Dealer May Owe Millions to Customers
Washington, DC – The U.S. Commodity Futures Trading
Commission (CFTC) announced today that on December 13, 2007 it sued One World Capital Group, LLC (One World) of Winnetka, Illinois, a registered futures commission merchant (FCM), and its President, John Edward Walsh of Lake Forest, Illinois, charging them with inability to demonstrate compliance with capitalization requirements and with failure to maintain required books and records.
On the same day the case was filed, the CFTC won an asset freeze and other emergency relief that will enable the Commission to freeze the assets of One World and safeguard the interests of its customers.
The complaint alleges that One World has been unable to demonstrate that it has maintained at least $1 million in adjusted net capital, the minimum requirement needed for FCMs that are Foreign Currency Dealer members of the National Futures Association (NFA).
According to the CFTC complaint, since at least November 28, 2007, One World and Walsh failed to demonstrate compliance with the net capital amount as required by the Commodity Exchange Act and CFTC regulations. As of December 10, 2007, the complaint charges, One World failed to demonstrate that it had any net assets. While One World appeared to possess $554,000 of funds held in customer accounts, since at least November 2, 2007, the NFA has been receiving complaints from customers alleging that they are unable to get their funds back from One World. The complaint alleges that the amount claimed outstanding by customers exceeds $4 million. The complaint also alleges that Walsh conceded an inability to identify all of One World’s customer liabilities. Furthermore, the complaint charges One World and Walsh with failing to maintain books and records as required by a CFTC regulation.
$4 million owed to customers? This will not be a very Merry Christmas for the customers now trapped at One World Forex.
Breaking News: FXLQ To Close Its Doors
An email is circulating around the net that FXLQ has apparently sent to their customers. The CFTC is about to sue them. FXLQ is in deep, deep, deep trouble:
FXLQ Shut down temporarily by NFA - Page 7
Tuesday, December 18, 2007
To our Valued Clients:
We have temporarily suspended operations due to a Commodity Futures Trading Commission lawsuit filed against the company in Federal Court. Please be assured that as soon as we are able, we will return any messages.
There is a hearing in the U.S. District Court scheduled for January 4, 2008 where we hope to resolve all issues the CFTC has with our company.
Thank you,
Forex Liquidity LLC
If the FXQL situation doesnt get sorted out and there is anyone on this thread that ends up losing out, please PM me
There are already people who ready to file lawsuits against the NFA for negligence.
Its about time we held them to account for the joke shop regulation of this industry, so the more people the better
Judgment Day
Today is the day when the $5 million minimum capital requirement rule takes effect. News out of Money Garden is that they are dropping their high leverage accounts in order to comply with the new rule. That means no more 400:1 leverage from MG, or 200:1 for that matter.
The following firms have still not publically indicated they have met the requirement. Beware these firms until further notice:
1) SNC Investments: $1,152,000
They are well below the $5 million capital requirement. It is highly unlikely they will make the new requirement at this point. I advise customers to leave this firm and look for greener pastures.
Update: Just went to their website and there is no reference at all to being able to open an account with them. I suspect they are just going to be an introducing broker from now on.
2) Wall Street Derivatives: $1,228,000
This firm is based out of New Zealand and I'm not even sure they have any U.S. customers as their U.S. website is out of service.
3) Advanced Markets: $1,322,000
Amifx is already teetering on the brink as they are the subject of a business conduct committee case before the NFA in which they are cited for a whole host of financial violations including not meeting the old capital requirement. This firm does not have much of a future.
4) AlpariFX $2,481,000
Little known European firm. Well under the cap requirement.
5) Solid Gold Financial: $2,040,000
Solid Gold's future is now in serious doubt. Like many of the other firms on this list they have been charged by the NFA with failing to meet their existing capital requirement. When you can't meet the old requirement it stands to reason you won't be able to meet the new one either. Solid Gold is anything but a solid investment at this point.
6) Bacera Corporation: $2,300,000
Like a turd that won't flush Bacera Corporation just refuses to go down the drain. The Savior wrote Bacera off over the summer as sources knowledgeable about them stated they were going to close up shop. But no, they are still hustling the folks in LA for fresh deposits. In September Bacera settled a complaint with the NFA after it was discovered they were undercapitalized to the tune of $1.2 million. NFA reported Bacera only has about 200 customers as it is. But to those 200, do yourself a favor and get yourself another broker because sooner or later the pipes are gonna get cleaned and these guys are going to get flushed once and for all.
Update: They published their Holiday Trading Schedule on their website. So they apparently don't plan on closing their doors. Do they have the money? Is the CFTC going to raid the place after the Holidays? We'll soon find out.
7) ODL Securities: $2,566,000
Ravaged by undercapitalization issues.
8) Forex Club: $3,320,000
They still have not hit the minimum $5 million mark. And don't forget since they are a market maker they have other financial requirements to meet as well. They still haven't publically done so.
9) Easy Forex: $3,789,000
Under siege for their sleazy sales tactics, it's hard to imagine the NFA isn't going to drop the hammer on them soon.
So now what? Judging from the NFA's website it doesn't appear they will be moving in for the kill yet. In fact, it may not be until January that we find out who will survive and who will perish. So if you have any money at these at risk firms get it out now. And Merry Christmas everyone!
thanks Linuxser. I didn't include CMC because they are a major publically traded company in the UK who are very well known. So I don't think there is any risk associated with them in comparison to the other firm's on the list. Alpari does not have the kind of resources as CMC has and are a far greater risk in my opinion.