Proposed NFA Capital Requirement

Discussion in 'Forex Brokers' started by forexsavior, Jun 28, 2007.

  1. Surdo


    Just an head's up>>>> Forexsavior AKA Felix Homogratus is not exactly squeeky clean around the Forex community. Just Google his "name". He is known as Dmitri Chavkerov in his Russian circles.

    #21     Jul 9, 2007
  2. Moe27


    a friend of mines has a account with them he loves them, good to see they have there heads way over water, also don't foreget they or a liquidity provider for some brokers interbankfx is one of them, maybe thats the reason for the high cap.
    #22     Jul 10, 2007
  3. sim03


    I'd offer at least 20:1 odds that forexsavior and Felix are not the same person. They exhibit sharply dissimilar English language usage patterns.
    #23     Jul 10, 2007
  4. Let me ask you something. If you had a business with employees and Workers Compensation required you to put up 50K to protect your employees, are you gonna put up 100k just to prove you will indeed protect them?? I think not! Then why should MBT put up more than what is required to prove a point?
    #24     Jul 10, 2007
  5. Moe27


    agree, plus mbt takes no risk at all, that don't hold costumer trades so there no risk like dealing desk brokers.
    #25     Jul 10, 2007
  6. Surdo


    Thanks for the analysis Felix!
    Don't you have a news spike to trade?
    #26     Jul 10, 2007
  7. creed


    This line of reasoning does not make any sense at all. Are you saying that MB Trading actually has the money but instead of putting it in a bank account and letting the CFTC know they have the money that instead they are hiding it under the matress?
    #27     Jul 10, 2007
  8. Croach


    All firms including MB Trading have risks. You as a customer are not the counterparty to the trade. It doesn't matter if the firm is a Dealing Desk, Non Dealing Desk or ECN type model. The banks do not have a credit relationship with the customers of these firms. If a customer loses more than the equity in their account the firm has to make good on the trade. MB Trading is the counteryparty to every customers trade.
    #28     Jul 10, 2007
  9. Moe27


    Thats a small risk compare to a broker holding your trade hoping you lose, thats what margin calls or for. might not work all the time.
    #29     Jul 11, 2007
  10. As I continue to update the dead forex firms walking list I'm amazed how many people think fraud and undercapitalization are completely separate issues. Often times they are not. The reason is quite simple: firms that are committing fraud are not known for having legible books. And Vice versa. Firms that have a hard time maintaining their capital requirements will often cut corners and commit fraud to keep their firms from going under. Finally, smaller firms simply don't have the money to maintain the kind of large legal and compliance staffs necessary to keep up with the battery of regulations being issued by the NFA and CFTC. And of course some firms are just plain incompetent. All these factors have come to a head with Forex Dealer Dead Pool Member One World Capital, who is now in serious trouble with regulators.

    To see the full report on One World's misdeeds you can click on the NFA's report yourself:

    I have highlighted some of the worst allegations below. After reading through them I think you'll understand why One World is on the dead firm's walking list and why that should be serious cause for concern for anyone who has an account with them or any firm like them.

    "One World lacked an understanding of, or was inattentive to, regulatory requirements and was ill prepared to accept customer business as either an FDM or an FCM. The firm had not established adequate systems to enable it to handle customer funds or comply with customer reporting requirements."

    "The firm was unable to properly account for its liabilities to its forex customers." (Insert appropriate jaw dropping sound. This is the text book definition of a firm destined to go bankrupt.)

    "In addition, NFA's audit found that One World and Walsh [Principal] provided false and misleading information to NFA auditors concerning an individual names Charles Martin and his role at One World. Walsh said Martin had no involvement in the firm. However, NFA subsequently learned that Walsh's claim was untrue and that Martin was, in fact, heavily involved in the operations of One World and solicited customers on its behalf." (Who is Charles Martin you ask? The NFA states Martin was turned down to be a principal before because of a "felony drug conviction and a misdemeanor theft conviction.")

    It goes on and on, misleading promotional materials, outright lies to regulators, failure to report capital and maintain any semblance of book keeping standards. In short, One World is a classic Dead Forex Firm walking. Firms like One World are the reason the NFA is going to raise capital requirements. And when they do, does anyone honestly believe the One World's of the world will survive?
    #30     Jul 11, 2007