Partners are Regularly Cheated by Forex Brokers

ATFX conducted extensive research, including discussions with numerous partners on their experience with brokerages

The revolutionary Marketing Partner Programme (MPP) run by ATFX Global Markets (CY) Ltd (ATFX), is fully-regulated and in line with the updated MiFID II regulations.

It stands out from the crowd due to its innovative commission structure. While most affiliate programmes link commissions to the trading activity of introduced clients, MPP pays partners based on where an introduced client is within the company’s sales funnel.

This protects the interests of investors and satisfies regulatory bodies clamping down on trading activity commissions which are often associated with a broker/partner ‘conflict of interest.’

In order to design the MPP plan which puts partner needs first, ATFX conducted extensive research which included discussions with numerous partners on their experience with brokerages. Key findings revealed many ways in which partners are regularly cheated by their brokers – so let’s take a closer look.

False promises

The first thing that most partners complained about was that partner programmes often publicized various rebate and reward schemes to entice people to join as partners with huge rewards and payouts being particularly common.

It was only after the partners joined the programmes that they realized the fine print was worded in a misleading way and that the rewards and payouts were not only difficult to achieve, but impossible in some cases.

MPP, on the other hand, ensures that all its processes are completely transparent, with no hidden clauses or deceitful fine print. By ensuring that all its services are fully compliant and regulated, partners are never left to worry about any part of the process or the relationship.

High payment triggers

Every broker will have a risk management department. The main function of this department is to safeguard the interests of the brokerage. The problem occurs when these departments try to safeguard the revenues of the brokerage at the cost of its partners.

For instance, if the risk management department believes that the flow of clients, trading activity or deposit levels from a particular partner have been declining, they penalize the partner by setting higher payment triggers.

So, the payment of commissions would thereafter be based on higher deposit amounts or the trading activity of referred clients. Even when payment is due, the partner does not have control over their referred business since the traffic is anonymous.

The first thing that ATFX did while designing MPP was to revolutionise the commission structure. Given that the regulators have been coming down hard on trading activity-based commissions, basing commission on deposit size or trading activity would be in violation of the MiFID II rules. Therefore, MPP pays its partners based on where the referred client is within the ATFX sales funnel.

This ensures partners are not left wondering whether they will receive their due payment and can enjoy peace of mind that they will not be cheated out of what is rightfully theirs through some arbitrary change in the programme’s rules.

Attribution theft

Many brokers see partners as their competitors, and in an attempt to keep a large chunk of earnings for themselves, they follow the Last Click cookie policy. This helps the brokerage attribute conversions to their own marketing team, cheating partners of their deserved commission.

In most cases, partners are unable to prove that client conversion was due to their efforts and not the brokerage’s internal marketing department. MPP, however, has been designed to prioritise the needs of clients. The ATFX marketing department is in fact never attributed in the case an online affiliate was involved at any point in the client journey.

In fact, the programme has very clear KPIs and performance benchmarking, so that every partner can track their own performance. Unique tracking links are provided to partners to help them monitor the results of their marketing efforts. MPP strives to ensure that not only is there no conflict of interest but that there is never any doubt about attribution of conversions.

Other means of cheating partners

Most existing partner programmes are designed so that the brokerage can continue to earn. Some programmes are designed to ensure the conversion rate for partners will always remain lower than that for the internal sales department. So, if the sales department’s commissions start to fall below that of the partners, leads from partners are either followed up last or not at all.

There also are programmes where the commission value is either not specified clearly or keeps changing. Brokers have been known to lower the commission payouts for partners they view as earning high commissions.

Another way that brokerages cheat their partners is when they suddenly decide that any traffic or leads from a specific region or country are no longer welcome. They arbitrarily stop commission payouts for any leads that might have emerged from those regions. All the hard work that a partner might have put in, therefore, is simply wiped out, with no further explanation provided.

Surprisingly, some programmes even penalise partners for withdrawals made by their referred clients. They do this by calculating the commission based on net deposits, or deposits that remain after withdrawals are made, rather than on gross deposits. The effect is that the accrued commission value is immediately slashed.

Violating regulations

Almost all these practices, followed by brokerages to safeguard their own interests, are in violation of the rules and regulations for the functioning of brokers and partners within the EEA. This is a huge cause for concern for partners, given that if the regulators crack down on the broker, the partners would lose their source of income overnight.

They might even have to face regulatory action. MiFID II has been specifically revised to focus on the best interests of clients. If a partner programme is compliant with these regulations, it will automatically safeguard the interests of its partners and retail clients.

This is exactly why MPP has been carefully designed to ensure that every aspect of the programme is not just partner and client focused but also ethical and in compliance with the existing rules and regulations. In fact, ATFX regularly holds training programmes and seminars, while also publishing articles, to inform people about the latest rules and regulations and how to function within a compliant and regulated environment.

Discover more out the revolutionary new MPP from ATFX.

HIGH RISK INVESTMENT WARNING: Trading Foreign Exchange (Forex) and Contracts for Differences (CFDs) is highly speculative, carries a high level of risk and may not be suitable for all investors. You may sustain a loss of some or all of your invested capital, therefore, you should not speculate with capital that you cannot afford to lose. You should be aware of all the risks associated with trading on margin.

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