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IMPORTANT REGARDING THE NEW PROPOSED CFTC RULES FOR RETAIL FOREX
Fellow Traders,
How important is it to you to know the facts about the new rules the CFTC is proposing for Retail Forex.
I will be doing a live interview on www.AllthingsForex. com Monday at 1:00 PM Eastern Time on the Forex Markets to discuss this matter but also to bring to light how transparent some of the rules that the CFTC is proposing which would make the Forex Spot Market better for traders like yourselves. www.AllthingsForex. com does radio broadcast daily that are also archived for listeners that could not listen to it live.
If you are like me, you are tired of people complaining and misrepresenting the actual facts of these rules. Yes the CFTC does make a mention a proposed change in leverage.
This is how it reads on Page 4 and 5 of the CFTC's proposal:
"The Proposal would also implement the $20 million minimum net capital standard in the CRA for registering as an RFED or offering retail forex transactions as an FCM; propose an additional volume-based minimum capital threshold calculated on the amount an FCM or RFED owes as a counterparty to retail forex transactions; and require RFEDs or FCMs engaging in retail forex transactions to collect security deposits in a minimum amount in order to prudentially limit the leverage available to their retail customers on such transactions at 10:1"
Now for those of you that don't know what a FCM is? A FCM is a Futures Commission Merchant and a RFED is the new term for firms that just offer Forex to their retail clients; Retail Foreign Exchange Dealer.
Now before we run and hide from the regulators and say foul play, I want you to read the following which is stated in page 16 :
"The Commission's proposed regulations are designed to deal with those differences, including the principal -to-principal nature of the transactions and the inherent conflicts of interest between the retail customer and the marketmaker/ counterparty. In the nine years since the passage of the CFMA, the Commission has observed a number of improper practices that have raised concern, among them solicitation of fraud, lack of transparency in the pricing and execution of transactions, unresponsiveness to customer complaints, and the targeting of unsophisticated, elderly, low net worth and other vulnerable individuals."
44 Between December 2000 and September 2009, the Commission has filed 114 forex-related enforcement actions on behalf of more than 26,000 customers. Those efforts have thus far resulted in the award of approximately $476 million in restitution and disgorgement, and $576 million in civil monetary penalties. An overwhelming majority of these cases involved solicitation fraud.
Now, who do people go to when they have been wronged and taken advantage of, they go to the NFA and CFTC. Yet some of you feel that it is better to run to Malta, Cyprus and other less regulated countries that will do nothing when you complain or lose your money. But how dare someone try to make forex trading better for everyone here in the U.S.
Well here is your moment to speak your mind and let the CFTC know that you don't agree with that 10:1 Leverage rule they are thinking of passing. The CFTC is looking to receive public opinion from you within these next 60 days. Don't pass up the opportunity to let them know your concerns because they want to hear from you. There is no excuse for you to say that no one told you where to submit your comments now.
You may submit comments, identified by RIN3038-AC61, by any of the following methods:
1) Federal eRulemaking Portal: http//www.regulatio ns.gov/search/ index.jsp Follow instructions for submitting comments.
2) Email : secretary@cftc. gov Include "Regulation of Retail Forex" in the subject line of the message.
3) Fax (202)418-5521
4) Mail: Send to David Stawick, Secretary, Commodity Futures Trading Commission, 1155 21st Street,. N.W., Washington, DC 20581
Remember not exercising your right to speak is your responsibility and no one else's.
Ricardo Menjivar
Futures & Forex Broker for PFGBEST
www.pfgbestdirect. net
NEW SECTION ADDED: MEETING ARCHIVES - AUDIO AND VIDEO! Click here to access. For a limited time, we're making archives of past 4XLA sessions available for free. These sessions will only be available to paid members in the very near future so be sure to have a look before they become a members-only benefit. You'll get to see and hear the latest speakers who delivered some great presentations at our recent meetings. Instructions for running the sessions are on the archive page.
