Prop firms with "Training Fees"

I am looking at possibly joining a trading firm that requires a "training fee". I am an experience trader so obviously we know the deal. I was just wondering how legal of a structure is this as it seems to be the loop hole around things now. Thanks

 

i dont get it.. am i missing somthing

 

Everything can be considered legal until you get caught. Suggest you check out the Tuco situation, especially the part about overrides.

 

Tuco was a unique situation because a Broker Dealer (GLB) was paying a Licensed Broker (Doug Fredericks). Some Assent offices were set up like this also. Most prop firms are NOT set up this way

With regard to a "training fee"...I think this is legit if you understand that it is not a deposit. Just make sure you understand what the training gets you and if it can be credited back to you somehow.

 

My main question is if going with one of these prop firms that require a "training fee" how legal is their structure like this? I am an experienced trader I don't mind at all throwing down 5k for a training fee the main thing is once I start to make money will I ever have to worry about a company like this being shut down like tuco did? I would imagine if the prop firm has everything panned out with their lawyer to set it up properly there should be no problems like velez right?

 

Are you asking if Oliver Velez's set up is legal?

 

I don't get it. You're an experienced trader yet you're willing to pay 5K as a training fee? Why? If you're experienced it means you have a track record (or do you mean you're an experienced trader but you have no verifiable track record of +ve months/years?). They should be happy to have you around, and shouldn't need a training fee.

Sorry if my question is off-topic, I understand that you're asking about what you can infer about the structure of the company from the fact that they're charging a training fee.