Hello, I've recently got into day trading after about a year or so of studying. My goal was to save up 30,000 to comply with the PDT rule. However, I discovered Suretrader, which at first there was no way that I'd trust a foreign broker to keep my money safe. Then I started reading into it and had a hard time finding anything that was wrong with this broker, besides, the poor customer service (which is expected). Jumping the gun, I decided to become a full-time trader and quit my job (Funny, I know). I have plenty of money saved and very little bills. I was getting sick of that particular job anyway. I'm a confident young man that shouldn't have a hard time finding a job if need be. Anyways, I made 3 trades today, first time using this new broker. Made about 200.00 in realized gains. So far so good. Right? Then this happens... I've been talking with other traders and looking into a trade chat room to get some ideas and tricks from other traders. I decided to email Meir Barak, I suppose he's the owner of Tradenet. He reply's back to my email. Asking which broker and what part of the world I was in. I quickly answered. He responds back with "Suretrader is not legal for US residents, and also not regulated. Your money may be at risk. Can’t recommend this, but I hope you will be fine." This is what he stated verbatim. It's actually quite funny because I was referred by a trader that trades with Meir. I informed him of this and the extensive research I put in to confirming if this was a legitimate company. He reply's back with "Swiss America Securities, Ltd (SureTrader) does not accept accounts for U.S. Persons that have been solicited directly or indirectly in compliance with SEC Rule 15a-6. For more information click U.S. Residents.". Which I read before, but re-read to see if I missed the true meaning. Still unsure.. I called them, Suretrader confirms that it's legal (not very reassuring). Now I'm concerned for my personal safety. I know this is just something that will have risks, choosing an out of country broker. I accepted the risks, but am I or Suretrader breaking the law? Losing the 5,000 that I put into Suretrader, would be devastating, but I would eventually get over it. Breaking the law. That's a different story. I obviously don't expect anyone to guarantee my safety, but any insight would be greatly appreciated. Thanks,
Get your money the hell out of there. There is a reason they are offshore. To avoid regulators. If you don't have the 30k to put in a retail account to comply with The PDT rule then take your 5k and go to one of the legitimate prop firms out there. There are plenty that will let you trade with 5k. You probably will have to give them 10% of your profits, but will be well worth it. You won't have to worry if your money is going to be around the next day.
Interesting. I was just considering opening an account with them as daytrader rock star speaks highly of them. I'm wondering if anyone knows of any problems caused by being an account holder with them.
SureTrader is an affiliate of Swiss America Securities, Ltd. located at: Bay Street, Suite 17, Nassau, Bahamas. That said it would be highly advisable to review your decision to establish an account at that firm with your accountant and/or attorney. Especially the former as tax reporting requirements are different than U.S. requirements. Your monies are in an offshore account, not regulated by any U.S. agency (e.g. SEC, CFTC, etc. or self-regulatory orginization (e.g. FINRA, NFA, etc.) Hopefully SureTrader has told you all about the Foreign Account Tax Compliance Act and the (FATCA) form, and had you complete a Report of Foreign Bank and Financial Accounts (FBAR) form and a W-9 form. And that you have to comply with the FinCEN's Report 114, Report of Foreign Bank and Financial Accounts. And on and on. When you complete these forms now the US agencies will know you have/had a foreign account. You are now on the IRS' radar and your chances of an audit just went up precipitously. Not to mention the other Federal agencies who are interested in people moving monies around in foreign accounts. The Department of Homeland Security comes to mind. The Commerce Dept's Office of Foreign Asset Controls (OFAC) also comes to mind. And so on. Call me cautious but trading at an offshore firm just to avoid the PDT rules seems risky to me. If the firm fails to whom do you go to to complain or seek restitution? The Bahamian government? I don't think so. Best
So, how do they get around PDT. Is there a commingling of funds so that US authorities only see them as one account?
Likely because they are a foreign entity that doesn't quite comply with US laws. This applies to Singapore as well.
I'm not sure if there are problems other than getting your money out quickly. But what about all of the FEES ? Software, Data, Fixed Trading Fee, Variable Trading Fee..... and a wire transfer costs $50 ??