CFTC Fines LMC Asset Management for Unregulated FX Dealings
The U.S. Commodity Futures Trading Commission today issued an order settling charges that LMC Asset Management, of Deerfield Beach exercised discretionary trading authority over customers’ accounts in retail, leveraged foreign currency (Forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term) transactions, without being registered with the CFTC as a Commodity Trading Advisor (CTA).
The CFTC order finds that from at least October 18, 2010, to at least October 21, 2011, LMC exercised discretionary trading authority over accounts of persons who were not eligible contract participants (ECPs) in forex transactions without being registered with the CFTC as a CTA. As a result of LMC’s solicitations, 36 non-ECP customers opened Forex Trading Forex Trading Forex trading is the buying and selling of foreign currencies with the aim of generating a profit. The value of currencies, especially floating currencies, fluctuate to varying degrees. This constant volatility of exchange rates opens the door for speculators to invest in a certain currency against another. The Forex market is the world’s biggest and most liquid market, with over $5 billion turnover every single day, with the market being open 24 hours a day, 5 days a week.It goes without saying Forex trading is the buying and selling of foreign currencies with the aim of generating a profit. The value of currencies, especially floating currencies, fluctuate to varying degrees. This constant volatility of exchange rates opens the door for speculators to invest in a certain currency against another. The Forex market is the world’s biggest and most liquid market, with over $5 billion turnover every single day, with the market being open 24 hours a day, 5 days a week.It goes without saying Read this Term accounts, with deposits totaling approximately $455,155.22.
The CFTC order requires LMC to pay a $140,000 civil monetary penalty and to cease and desist from further violations the Commodity Exchange Act and CFTC regulations, as charged. The order also prohibits LMC from entering into any commodity-related transactions, soliciting or accepting funds from any person for transactions involving commodity futures, commodity options, security futures products and/or forex contracts, and from trading or applying for registration, among other sanctions, until it has paid the civil monetary penalty.
On October 18, 2010, the CFTC enacted new regulations implementing certain provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and the 2008 Farm Bill, regarding off-exchange retail forex transactions, including requiring CTAs to register before exercising discretionary trading authority over accounts of non-ECPs. According to the order, LMC failed to register as a CTA after October 18, 2010, as required, because it exercised discretionary trading authority over accounts of individuals who were not ECPs in connection with retail forex transactions.
The CFTC appreciates the assistance of the U.K. Financial Services Authority in this matter.
The U.S. Commodity Futures Trading Commission today issued an order settling charges that LMC Asset Management, of Deerfield Beach exercised discretionary trading authority over customers’ accounts in retail, leveraged foreign currency (Forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term) transactions, without being registered with the CFTC as a Commodity Trading Advisor (CTA).
The CFTC order finds that from at least October 18, 2010, to at least October 21, 2011, LMC exercised discretionary trading authority over accounts of persons who were not eligible contract participants (ECPs) in forex transactions without being registered with the CFTC as a CTA. As a result of LMC’s solicitations, 36 non-ECP customers opened Forex Trading Forex Trading Forex trading is the buying and selling of foreign currencies with the aim of generating a profit. The value of currencies, especially floating currencies, fluctuate to varying degrees. This constant volatility of exchange rates opens the door for speculators to invest in a certain currency against another. The Forex market is the world’s biggest and most liquid market, with over $5 billion turnover every single day, with the market being open 24 hours a day, 5 days a week.It goes without saying Forex trading is the buying and selling of foreign currencies with the aim of generating a profit. The value of currencies, especially floating currencies, fluctuate to varying degrees. This constant volatility of exchange rates opens the door for speculators to invest in a certain currency against another. The Forex market is the world’s biggest and most liquid market, with over $5 billion turnover every single day, with the market being open 24 hours a day, 5 days a week.It goes without saying Read this Term accounts, with deposits totaling approximately $455,155.22.
The CFTC order requires LMC to pay a $140,000 civil monetary penalty and to cease and desist from further violations the Commodity Exchange Act and CFTC regulations, as charged. The order also prohibits LMC from entering into any commodity-related transactions, soliciting or accepting funds from any person for transactions involving commodity futures, commodity options, security futures products and/or forex contracts, and from trading or applying for registration, among other sanctions, until it has paid the civil monetary penalty.
On October 18, 2010, the CFTC enacted new regulations implementing certain provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and the 2008 Farm Bill, regarding off-exchange retail forex transactions, including requiring CTAs to register before exercising discretionary trading authority over accounts of non-ECPs. According to the order, LMC failed to register as a CTA after October 18, 2010, as required, because it exercised discretionary trading authority over accounts of individuals who were not ECPs in connection with retail forex transactions.
The CFTC appreciates the assistance of the U.K. Financial Services Authority in this matter.