link to the previous article: http://www.business.dk/finans/saxo-bank-kunder-angriber-fra-hele-europa So, 10 Saxo customers have contacted the danish FSA. Not that much. "Berlingske Business would like to hear more from Saxo Bank customers who have experienced the events of Saxo Bank. Write topetj@berlingske.dk or call the financial editor Peter Nyholm on 41,726,404th"
Nobody knows the Danish FSA and we know they will do nothing and they will protect Saxo Bank interest who is paying them every year a tax. Not their customers who are suffering. You will see the FSA is useles, they are making money for nothing.
Important point is that Saxo bank is in breach of its General Business Terms. Saxo bank has corrected the price to a weighted average while Article 6.12 of their business terms allows them to correct to a "market" price. The fact that there was no liquidity is not important. Article 6.12 does not exclude Saxo's responsibility in such case. A good argument in a legal battle Article 6.12 It is possible that errors may occur in the prices of transactions quoted by Saxo Bank. In such circumstances, without prejudice to any rights it may have under Danish law, Saxo Bank shall not be bound by any Contract which purports to have been made (whether or not confirmed by Saxo Bank) at a price which: i Saxo Bank is able to substantiate to the Client was manifestly incorrect at the time of the transaction; or it was, or ought to have reasonably been known by the Client to be incorrect at the time of the transaction. In which case Saxo Bank reserves the right to ether 1) cancel the trade all together or 2) correct the erroneous price at which the trade was done to either the price at which Saxo Bank hedged the trade or alternatively to the historic correct market price
Even the Business terms and conditions are very unfair, that is the opinion of a lot of lawyer after to read it. Saxo Bank can not make a contract a write ''you agree that we can kill you'' and they have the right to kill you.. this is not business. The other traders did not have liquidity problems. Saxo Bank did not send our orders to the real market... they can not proof that was a liquidity problem for our orders. They are market makers and they have to pay for their mistake, not their customers which already paid for their mistakes trading. There is stop loss, you respect it, otherwise don't allow to trade with EUR/CHF.
You have a point there. Regulators tend to be very tough with small firms but easy with the large firms. And, for a small country like Denmark, Saxo is large. They provide many well-paying jobs, while the clients mostly are not Danish voters. I expect a small "neither admit nor deny" fine.
http://www.bloomberg.com/news/artic...ll-bank-franc-repricing-call-was-unacceptable (Bloomberg) -- Retail clients at Saxo Bank A/S are stepping up their fight to have it reverse last month’s decision to reprice Swiss franc trades. Lawyers for clients representing about 100 million kroner ($15 million) in claims say they will send Saxo a letter this week telling the Danish bank to reimburse them for losses caused when it retroactively priced franc trades at less favorable rates following Switzerland’s Jan. 15 decision to send the franc into a free float. Kasper Elbjoern, a spokesman for Saxo, declined to comment, saying it’s a legal matter and a question of client privacy. Saxo was aware its decision to reprice would probably trigger lawsuits, Chief Financial Officer Steen Blaafalk said Jan. 26. Jakob Ravnsbo, an attorney at Andersen Partners, which is representing Saxo clients inside and outside Denmark, says the dispute will end in court if Saxo doesn’t reimburse clients. “We think they’re not allowed to do what they’ve done -- that their agreement with customers doesn’t give them the right to do it, and so we dispute this way of treating customers and of course ask them to change that,” Ravnsbo said in an interview. Blaafalk said in January Saxo has the legal right to retroactively reprice deals under extraordinary circumstances. The bank has been negotiating with customers to recover some of the losses, he said then. Ravnsbo says his clients want full to be fully reimbursed for the losses caused by the repricing. Franc Losses The franc appreciated Jan. 15 to its strongest since the introduction of the euro in 1999, closing at about 0.98. Since then, the Swiss currency has weakened to around 1.08 per euro. The Swiss National Bank’s decision to abandon its ties to the euro left a number of the world’s biggest banks on the wrong side of franc trades, with Citigroup Inc., Deutsche Bank AG and Barclays Plc suffering about $400 million in cumulative trading losses, according to people familiar with the events. Saxo has said it stands to lose about $107 million, or roughly a third of its equity capital, because of the exchange-rate move. In the moments that followed the SNB’s decision, Saxo continued to fill orders even as liquidity dried up. Hours later, the bank told clients the prices at which it closed orders would be adjusted to account for the extraordinary conditions. Since then, customers have lined up lawyers and sent complaints to Denmark’s Financial Supervisory Authority, challenging the bank’s actions and its marketing material. FSA Scrutiny According to one client complaint, sent to the Danish regulator and obtained by Bloomberg through a freedom-of-information request, Saxo said it could provide “dedicated liquidity.” The bank later informed the same client there “was no liquidity in the market.” The client lost 200,000 euros ($226,500), the FSA documents showed. “They shouldn’t have repriced. They’re not allowed to reprice,” Ravnsbo said. “I don’t see it in their terms and conditions or in their agreements with customers.” Censeo Asset Management, which had offered clients a Saxo product, said it’s in talks with the Danish bank about its treatment of franc trades on Jan. 15. “We’re still in discussions with Saxo about how things were executed that day,” Gerhard Massenbauer, Censeo’s chief executive officer and founder, said by phone. He declined to comment further because the negotiations are private. The Vienna-based company said last month that couldn’t “recognize the lawfulness of” Saxo’s decision to reprice franc trades and that it would help its clients challenge the decision if a review showed the action is “questionable under Austrian law.” Denmark’s financial authorities also are scrutinizing the bank’s actions. In a Jan. 30 letter, the FSA asked Saxo why it took more than 2 1/2 hours to notify clients of the extraordinary conditions in the Swiss franc market, and why the bank didn’t stop trading amid a sharp increase in volatility. To contact the reporter on this story: Frances Schwartzkopff in Copenhagen at fschwartzko1@bloomberg.net To contact the editors responsible for this story: Veronica Ek at vek@bloomberg.net Tasneem Hanfi Brogger, Christian Wienberg
From another forum: http://www.forexfactory.com/showthread.php?t=522242&page=31 The FX brokers are NOT your agent. They do not act on your behalf and go to the market to execute your orders. There is no "market", it is just you and the broker trading to each other. And this is called a principal-to-principal relationship. The prices you see on the trading platform provided by the FX brokers, are all tradable prices. That is, the fx broker quote you a price, and if you accept it, you hit the button (or via stop order), the transaction is completed. This process involves offer and acceptance and the transacted price CANNOT be changed unless both parties agree. The FX brokers quote prices by subscribing to market data feeds, which there are examples like Reuters, InteractiveData, etc. After the SNB annoucement, these streaming prices were kind of in an orderly fashion, especially in the first few minutes after the annoucement. Then there are gaps, but a most a few hundred pips. EURCHF did not fall from 1.2000 directly to 1.0500 in the next second. Being a FX broker has to manage market risks. If a client long EURCHF before the SNB annoucement, and if SNB lifts the floor, the broker loses money if he doesn't have a long position with his external trading counterparty. But if he holds a long position outside, he also takes the risk that the trading counterparty gap down EURCHF from 1.2000 directly to 1.0000, say, on a manual quoting. Then the FX broker's hedge position is killed, before he close out his clients' position on a margin cut. However, this is NOT a reason that the FX broker can amend the completed trades with you, just because that he loses money outside with a bad trading counterparty. What he should do was, to quote a price he want to trade, always. He can quote you 1.1500 when Bloomberg contributors quoting 1.1800, it is his right to do so. But he cannot change a price he quoted and you accepted.
Exactly. Saxo Bank is market maker. They can not give you one X price and after some hours change the price and say that there was no liquidity. Of course there was no liquidity we trade in your market maker platform. What happen in the real market nobody knows. Sometimes they buy sometimes they don't buy. Is their way to do money. The real problem of Saxo Bank is that they bought a lot of EUR/CHF long positions to cover them selfs expecting that the EUR/CHF will not fall. They had a lot of customers long then they bought in the real market long positions. But they did not buy the short position in case that the floor fall. Then they made a big mistake and bad risk management. They deserve it. Because they are the worst brokers I have ever seen in my trading life. I will not touch Saxo Bank even with one pale in my life. For To For respect the pale's mother of course.
I agree what Saxo is trying to do with repricing is simply ridiculous. If the regulatory body rules it is not in breach of rules, nobody should trade in that jurisdiction henceforth. I have an account with Oanda and they have a clearly stated position in the agreement that they will close out before negative balances. They are market makers. Perhaps I am ambitious, but losing your entire account because a stop is not honoured is small consolation. I would like to know the legalities of your broker, also a market maker, not honouring a stop order they have accepted. In a free market of course nobody is obliged to take the other side of your trade. But what about when a market maker accepts your stop order, typically executes it, but selectively does not. How much certainty are we entitled to? I believe Saxo Bank is the counter party to customer trades, ie a market maker.