FXCM global subsidiaries seek to reassure clients

Maria Nikolova

As customer uncertainty over the future of the broker mounts, so do the efforts of FXCM’s international subsidiaries to assure clients that “there is no change”.

Several hours ago, Gain Capital Holdings Inc (NYSE:GCAP) announced it has entered into a definitive agreement to acquire the US client base of FXCM Inc (NASDAQ:FXCM) – this has been the latest in a series of rapid developments around FXCM, which was fined and banned from the US market by the US regulators.

invast pureprimeUncertainty has been piling up amid clients of the broker inside and outside of the United States, with social media channels getting filled with questions.

In the face of the tension, FXCM’s international subsidiaries keep telling their clients that it is business as usual. FXCM UK and FXCM France accounts on Facebook and Twitter feature reassuring messages.

“There will be no changes for clients outside of the U.S. With this exit, FXCM will be in a better position to service our international customers and focus on our profitable subsidiaries. And we will continue to provide the quality of execution and spreads our traders have come to expect” – FXCM UK.

Announcement on FXCM UK Facebook page

These statements are hardly surprising as they echo the tone of FXCM’s official announcement on the actions of US regulators and the pending sale of its retail FX business in the US to GAIN Capital. FXCM US stressed that the settlements “have no impact on any customer of FXCM’s global businesses”.

“There will be no change for the clients outside of the United States”, says FXCM France on Twitter.

In its press release from February 6, 2017, the United States National Futures Association underlined that FXCM has had a long history of disciplinary actions. Excluding the most recent actions against the broker, NFA’s Business Conduct Committee (BCC) has authorized four prior complaints against FXCM. In 2011, FXCM was charged with engaging in asymmetrical price slippage practices and had to pay a $2 million monetary sanction. Back then, the company was also ordered not engage in the types of deceptive and abusive practices.

Importantly, the UK Financial Conduct Authority (FCA) then reacted to the US regulatory action against FXCM. The UK regulator noted that although senior managers of the FXCM Group sat on the Board of FXCM UK and knew about the investigation, FXCM UK failed to alert the FCA. This was in violation of the FCA’s requirement that firms are open and cooperative with the regulator. When it became aware of the investigation in August 2011, the FCA stepped in to review FXCM UK and secure redress for affected consumers.

As a result of this investigation, the FCA fined FXCM UK £4 million for making ‘unfair profits’ and not being open with the UK regulator. Such investigations, however, take time – up to several years. This is hardly a good piece of news for those who’d like a swift regulatory response.

The question is how overseas regulators will react this time. Will they react at all?

Read this next

Retail FX

Banxso announces 8.7% interest rate on deposits in South Africa

“With Banxso, they can enjoy the benefits of both worlds – earning competitive interest and having the freedom to trade, all within the same platform.”

Industry News

FINRA to publish transaction details in U.S. Treasury securities

“Consistent with our longstanding practice, FINRA is introducing greater transparency in a calibrated and careful manner, benefiting liquidity and resilience in this critical market while also mitigating potential information leakage concerns.”

Institutional FX

OpenYield launches “cheap and easy” fixed income trading for brokers

“We’re on a mission to make bonds cheap and easy to trade, and are excited about the opportunity to build generational capital markets infrastructure.”

Digital Assets

Sumsub and Mercuryo publish a guide for VASPs: “Mastering Travel Rule Compliance”

“At Sumsub, we’ve concentrated our efforts on filling the gap in understanding the complexity of Travel Rule regulation and helping organizations find the best solution to stay safe and compliant while minimizing costs and avoiding potential risks of non-compliance. This guide we created with Mercuryo, our trusted partner, is the ultimate navigation tool all VASPs can consult.”

Digital Assets

Bitget Wallet Leads with Record Swap Volume & New Crypto Innovations

This week, Bitget Wallet achieved a milestone by surpassing Metamask with a record 388,757 Swap order transactions, securing the global lead. The significant 7-day trading volume, almost 68,000 more than its rival, underscores its liquidity and user trust. This robust activity signals Bitget Wallet’s prominent role and reliability in the dynamic crypto market.

Digital Assets

Embarking on a Digital Currency Journey

Imagine you’ve stumbled upon a treasure map, leading you to untold riches hidden in the vastness of the internet. Instead of gold coins and jewel-encrusted goblets, this treasure comes in the form of digital currencies, the modern-day loot coveted by many.

Reviews

Traders Union Experts Share The Trading Analyst Review For 2024

Navigating options trading in rapidly shifting markets poses a considerable challenge. This is where options trading alert services become invaluable. They aid traders in keeping abreast of evolving opportunities and market trends. In this assessment, Traders Union experts scrutinize The Trading Analyst alert service to ascertain its efficacy. 

Digital Assets

BlockDAG’s Presale Achieves $9.9M: Aiming For A 5000-Fold ROI As Cardano’s Price Rises And Fantom Launches Sonic

Explore Cardano’s surge, Sonic’s efficiency, and why BlockDAG’s growth makes it the top crypto choice. A deep dive into the future of blockchain investments.

Digital Assets

US, UK probe $20 billion Tether transfers tied to Russian exchange.

U.S. and UK authorities are investigating the movement of $20 billion in the USD-pegged stablecoin tether (USDT) through Moscow-based exchange Garantex.

<