Judge grants Effex Capital, John Dittami another time extension to respond to complaint in FXCM case

Maria Nikolova

Judge Paul A. Crotty of the New York Southern District Court has granted Effex Capital and its CEO time extension until September 1, 2017, to answer to complaint by disgruntled FXCM clients.

One of the cases against Global Brokerage Inc (NASDAQ:GLBR) that is gradually proceeding in the New York Southern District Court is that brought by Vantalie Nguyen on behalf of former FXCM clients who traded on the “NDD” platform offered by the broker and claim to have suffered damages as a result of the broker undisclosed interest in Effex Capital.

The Nguyen v. FXCM Inc. et al case names as defendants FXCM Inc (now known as Global Brokerage), FXCM Holdings, Dror Niv, William Ahdout, as well as Effex and its CEO John Dittami.

As FinanceFeeds has reported earlier, Mr Dittami and Effex Capital have requested another time extension to respond to the complaint by the plaintiffs. As per the latest court updates, the requested time extension was granted – as a result, Effex Capital and its CEO have time until September 1, 2017 to file their answer.

One of the possible reasons for the extension request is that the lawyers for Effex and its CEO would like to see the developments around another case – Effex Capital, LLC et al v. National Futures Association et al. The latter alleges that NFA revealed Effex’s trade secrets and caused harm to the company by posting the news release and complaint concerning FXCM and its alleged relations with Effex on February 6, 2017. Effex is now seeking for NFA to remove and/or amend the materials involving Effex from its website.

On Monday, NFA filed a Motion to Dismiss the complaint by Effex Capital and John Dittami. The Association insists that “as a self-regulatory organization, it has absolute immunity because all Effex’s claims arise out of NFA’s execution of its regulatory responsibilities”. It also says that Effex improperly and prematurely brought the suit against it without first exhausting available administrative remedies.

Claims made in the NFA complaint against FXCM served as an essential part of the evidentiary support in a number of cases brought against the broker. The Nguyen case is also based on this complaint to a great extent. NFA alleges that FXCM has had an undisclosed stake in liquidity provider Effex Capital and in this way the broker misled its customers over a period of several years.

Interestingly, while Effex and its CEO ask for time extensions, there is still no news regarding any answer to the complaint from Global Brokerage and its principals. In its report for the first quarter of 2017, the company said it was aware of the case brought by Nguyen and voiced its intentions to defend itself. Since then, there has been no official comment from Global Brokerage or any other FXCM entity about legal matters.

Read this next

Metaverse Gaming NFT

Despite crypto winter, Fastex grabs $23.2 million in Fasttoken token sale

Fasttoken, part of the Fastex web3 ecosystem, has secured $23.2 million in financing through the private and public token sales of its native cryptocurrency Fasttoken (FTN).

Digital Assets

Iran to repay Russian debts in gold-backed stablecoins

A high-ranking member of the Russian parliament confirmed reports that his country was in talks with Iran to create a stablecoin for foreign trade settlements, to replace the dollar, ruble and Iranian rial.

Digital Assets

SEC denies Cathie Wood’s bitcoin ETF for second time

The approval of a regulated crypto derivative is still looking far less likely, as the US regulators have once again denied Cathie Wood’s application for a long-awaited spot bitcoin exchange-traded fund (ETF).

Executive Moves

Pavel Spirin promoted to Scope Markets CEO following Rostro acquisition

Belize-based FX and CFDs brokerage Scope Markets has promoted Pavel Spirin to take on an expanded role as the company’s chief executive officer. He replaces the outgoing CEO Jacob Plattner, who has also been a major shareholder since he resigned his position as managing director at GKFX.

Retail FX

Public.com goes all-in on alternative investing, launches Rare Sneaker Portfolio

“The concept of curated Portfolios means that our members will be able to invest in categories like art, trading cards, royalties, and real estate without needing to become subject matter experts on individual assets.”

Industry News

State Street taps AWS and Microsoft for cloud and infrastructure solutions

“By standardizing and simplifying our technology operating model, we will be able to more quickly deploy client environments and launch new products and services, while continuing to enhance the resiliency of our technology environment and our business operations.”

Institutional FX

Bitpanda launches Investment-as-a-Service business for banks, fintechs, online platforms

“Financial institutions today have to ask themselves how they aim to cater the increasing demand for modern investing solutions. Building these Individually, means a high startup cost, and products that are often outdated before they are even launched.”

Institutional FX

Options expands market data feeds after partnership with Tools for Brokers

“Our integration with ACTIV Financial marked the beginning of a new era in market data availability and infrastructure. Our teams have come together to provide unparalleled, fully managed market data services alongside Options’ global connectivity and infrastructure.”

Industry News

Recruitment in financial services sector buoyant despite planned mass layoffs

“It remains to be seen what impact this will have on hiring levels within the financial services arena this quarter”, said APSCo, regarding the expected mass layoffs within the financial services sector in England & Wales.