The CFTC has now extended its open comment period: http://www.cftc.gov/PressRoom/PressReleases/pr6493-13
The bankruptcy judge for the PFG Best case is expected to decide on the complaint filed by the forex/metals account holders at PFG. AP has an article out detailing the conflict between futures and forex customers: http://www.boston.com/business/marke...5VM/story.html Retail forex traders still have an opportunity to tell Washington that this kind of disparate treatment of retail forex customers needs to end. The CFTC comment period on additional customer reforms remains open: http://comments.cftc.gov/PublicComme...m.aspx?id=1320
I think it would be useful to first try to help all former PFG customers by suing to recover funds from other deep-pocketed potential defendants who may have been negligent by ignoring signs of problems in PFG's accounts (or even helping PFG cover up): U.S. Bank J.P. Morgan Auditors The NFA etc. Let's ask for a thorough investigation of potential liability of these parties. I am not saying that all of them were negligent, but just let's look into it closely and sue them if grounds can be found. This investigation should be done by The PFG Trustee The CFTC Congress The Justice Dept. If all of these fail to investigate adequately, as a last resort it will be done in the private class-action lawsuit, but it should not have to be left to private parties. By the way MF Global customers have got back 94% (soon 100%) per cent of their money back now, so can we focus primarily on PFG now, most of whose customers have still only got 30% back for futures customers, and 0% for forex customers.
This post is a perfect example of everything is either white or black only. The reality is that the world is more of a gray color, with many shades of it. Totally free markets are just as bad as totally regulated ones.
The CFTC held another public roundtable on the PFG/MF Global customer protection proposals that are now open for comment: http://www.bloomberg.com/news/2013-...mer-funds-rules-get-another-cftc-hearing.html FXCM continues to advocate for greater FCM/RFED transparency as detailed below. The CFTC will keep its comment period open for one more week. Proposals to Bring Full Market Transparency and Accountability to the Futures/Forex Industry 1) Require All FCMâs to Publicly Publish Their Financials Once a Quarter: Currently, the CFTC publishes monthly âNet Capitalâ reports that disclose to the public how much money a Futures Commission Merchant has set aside in capital. However, that report provides very little insight into how well the company is doing financially. By requiring FCMâs and RFEDâs to publish their audited financials the trading public will know how much risk they are taking with each firm since investors will be able to weigh the liabilities along with the excess capital that these firms have. Furthermore, the published financial statement should include everything (i.e. holding companyâs financials) since what happens to other subsidiaries of the company can easily affect the regulated FCM/RFED. Each company should be required to provide a link to its financials on its own homepage so that the public can do its proper due diligence. Too often, those firms that are teetering on the edge of bankruptcy lure customers in by offering unsustainable gimmicks (dirt cheap commissions, account opening bonuses) that temporarily puts off the inevitable. Customers should be aware of the perilous finances of those firms that would offer these kinds of gimmicks before opening an account with such a firm. PFG Best was a classic example of a firm that used such gimmicks as they routinely low balled their competitors with uneconomical discounts that no reputable, legally compliant firm could match. 2) Require all FCMâs to Employ a Top Ten Accounting Firm: There need to be much higher accounting standards than currently exist in the FCM world. The Platt Group publishes an annual ranking of public accounting firms that could be used by FCMâs. Whether it is top 10 or top 25, the main point is that FCMâs must use a nationally recognized and respected accounting firm that could apply the same tough standards to FCMâs that publicly traded companies must meet. While no one proposal will guarantee that a future FCM will not fail, these proposals will enhance the publicâs due diligence capabilities by bringing greater market transparency and accountability to the world of futures/forex trading.
The comment period for the CFTCâs additional customer funds protection proposal is now closed. But there will be additional opportunities to advance the cause of greater retail forex protections this summer. Yesterday, Senate Agriculture Committee Chairwoman Debbie Stabenow announced that she and Ranking Member Thad Cochran are soliciting comments from the general public in the run up to this yearâs CFTC Reauthorization: http://farmfutures.com/story-sen-stabenow-announces-cftc-reauthorization-plan-17-95412 "These comments and recommendations will become part of the public conversation," Chairwoman Stabenow said. "We would like to hear from the public on a couple of fronts: concerns with commodity market oversight generally and on the need for additional customer protections in light of the failures at MF Global and Peregrine Financial. Senator Cochran and I will work together closely on this issue. The process will be open and bipartisan while the product will be consensus-driven." Retail foreign exchange has long been in need of additional customer protections, in particular segregation of customer funds and account insurance. We expect these issues to be front and center this summer and customer backing will be necessary if we are to have any success convincing Capitol Hill to support these necessary reforms. More to come in the weeks and months ahead.
No, sorry, you are incorrect. My funds held in segregation should never be "at risk" due to the broker going out of business. I was at Lin Waldock when Mann Financial went down, my account was perfectly safe. In the case of MFG and PFG, it was theft, pure and simple, by the head of the companies. If I'm a poor trader and lose my money, that's one thing, but to lose my money due to theft is totally different. Just because I trade futures does not mean that I am accepting a non segregated, at risk situation for my account. Everyone trading stocks, mutual funds, ETF's are usually safe in the event of a brokerage collapse, the futures industry for 150 years was the same if not better until thieves robbed the segregated funds.
I agree... but to make it easy how about... a rule which says any executive caught betting company funds in the market goes to prison for 5 to 10 years minimum. Any auditor or accountant who does not immediately report unusually activity to to the cftc or sec loses goes to jail and their firm must repay the loses suffered by parties exposed to the loses. That corzine is not in prison... threatens the safety of all banks and all futures accounts. Anybody allowing anyone who works for a futures merchant or stock trading outfit... has a duty to make sure the funds being bet are not customer funds... Otherwise they will also make up the loses out of whatever profits they have and the execs and the brokers executing the trades will go to jail too.