FXOpen settles with the CFTC for accepting US clients
This was one of the biggest news last year - CFTC sued 14 forex firms (and then 11 more) for

This was one of the biggest news items last year – CFTC sued 14 forex firms (and then 11 more) for various infringements of its laws including accepting US clients. Some firms (offshore ones) decided to ignore this all together and kept accepting American clients, some stopped accepting them but didn’t settle and some managed to settle their cases. FXOpen was certainly the largest of the brokers sued and finally managed to settle this issue. This should help FXOpen reestablish its brand and become regulated more easily in various jurisdictions.
Illinois Federal Court Imposes $140,000 Civil Monetary Penalty on Foreign Currency Firm, FXOpen Investments Inc., for Acting as an Unregistered Retail Foreign Exchange Dealer
Action part of CFTC’s nationwide sweep against foreign currency firms for failure to register under the 2008 Farm Bill, the Dodd-Frank Act, and CFTC regulations
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Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) has obtained a federal court consent order requiring defendant FXOpen Investments Inc. (FXOpen), a foreign firm, to pay a $140,000 civil monetary penalty to settle CFTC charges that it illegally solicited members of the public to engage in foreign currency (forex) transactions and operated as a Retail Foreign Exchange Dealer (RFED) without being registered with the CFTC (see CFTC Press Release 5974-11, January 26, 2011).
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The order, entered on December 22, 2011 by Judge Virginia M. Kendall of the U.S. District Court for the Northern District of Illinois, also orders FXOpen to close all U.S. customer accounts and return U.S. customer funds. The order also permanently bars FXOpen from engaging in any conduct that violates the Commodity Exchange Act (CEA) and CFTC regulations.
Specifically, the order finds that between October 18, 2010, and January 26, 2011, FXOpen acted as an RFED by taking or offering to take the opposite side of customers’ forex transactions without being registered as an RFED, which is in violation of CFTC regulations. The order also finds that during the same time period, FXOpen solicited or accepted customer orders to place forex trades without being registered, which is in violation of the CEA.
In the forex market, entities known as RFEDs or Futures Commission Merchants (FCMs) may buy forex contracts from, or sell forex contracts to, individual investors. Under the CEA and CFTC regulations, an entity acting as an RFED or FCM must register with the CFTC and abide by rules and regulations designed for investor protection, including those relating to minimum capital requirements, recordkeeping, and compliance. Further, with a few exceptions, such an entity also must be registered with the CFTC if it solicits or accepts orders from U.S. investors in connection with forex transactions conducted at an RFED or FCM.
The CFTC strongly urges the public to check whether a company is registered before investing funds. If a company is not registered, an investor should be wary of providing funds to that company.
A company’s registration status can be found at: www.nfa.futures.org/basicnet
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Can you link this entire post to the comments section from your post about the interview with the guy from FinFX who openly spoke about taking US clients even as an unregged broker in Finland?
Any news about the other 24 brokers named? I am interested to see if they even responded to the CFTC.
So.. what? They just paid the fine? And they still can’t accept US clients? I don’t really know why they paid the fine, considering that their base of operations is NOT the USA and they do business over the internet, which is not regulated by any one specific country.
IMHO, this whole crackdown on foreign brokers with just another case of institutionalized corruption in the USA, the biggest benefactors being.. take a wild guess! Who cares if the consumer lost out!
Beginner investors are always advised to take bigger risks. I’ve been told, since we’re younger we have time to make back any losses and capitalize on gains.
At the same time, as a beginner investor, I wouldn’t be aware of such restrictions unless a company explicitly stated this condition on its homepage.
If the government is going to crack down, then maybe companies should consider adding a warning to their site, before US IP addresses can view the page.