{"id":7500,"date":"2010-03-11T09:59:11","date_gmt":"2010-03-11T14:59:11","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=7500"},"modified":"2010-03-11T09:59:11","modified_gmt":"2010-03-11T14:59:11","slug":"leading-forex-introducing-brokers-form-coalition-to-challenge-proposed-cftc-rulings","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2010\/03\/11\/leading-forex-introducing-brokers-form-coalition-to-challenge-proposed-cftc-rulings\/","title":{"rendered":"Leading Forex Introducing Brokers form coalition to challenge proposed CFTC rulings"},"content":{"rendered":"

Forms IBcoalition.org and proposes fair industry-based alternatives to regulations<\/em><\/p>\n

<\/strong><\/p>\n

Boston, MA \u2013 March 11, 2010 \u2013 <\/strong>Today, a group of leading Forex Introducing Brokers (IBs) announced the formation of www.ibcoalition.org<\/a><\/span>, an organization comprised of independent, regulated Forex Introducing Brokers who have joined together to challenge the proposed CFTC rules titled \u201cRegulation of Off-Exchange Retail Foreign Exchange Transactions and Intermediaries,\u201d 75 FR 3282 (Jan. 20, 2010).<\/p>\n

The main mission of the IB coalition is to suggest significant changes to the proposed CFTC regulations. The IBs currently participating in www.ibcoalition.org<\/a><\/span> are ATC Brokers (NFA Member #0358522), BackBay FX (NFA Member #0388617), Currensee (NFA Member #0403251), Fast Trading Services LLC d\/b\/a FastBrokers.com (NFA Member #0342002), Forex On The Go, LLC (NFA Member #409594) and Gecko Financial Services, Inc. (NFA <\/strong>Member #<\/strong>0402367).<\/strong> <\/strong><\/p>\n

\u201cWe formed IBcoalition.org to come together as regulated IB businesses to oppose the proposed CFTC regulations that, if passed, will significantly change our businesses,\u201d said Dave Lemont CEO Currensee<\/a>.\u00a0\u00a0 \u201cThose of us in the IB Coalition are, we believe, the types of firms the Commission should be supporting as alternatives to the fraudulent unregistered solicitors the Commission has spent so much time and effort shutting down over the years. Unfortunately, though, in its zeal to curtail fraudulent solicitation practices, the Commission is proposing a set of rules that needlessly restrict legitimate Forex activities and will, if adopted, seriously undermine our ability to operate successfully as regulated alternatives. We welcome the opportunity to meet with the Commission and present our comments directly.\u201d<\/p>\n

The pending CFTC rulings propose that a Forex IB must enter into a guarantee agreement with a CFTC-regulated Forex Dealer Member (FDM), along with a requirement that the Forex IB may be a party to only one guarantee agreement at a time. By asking IBs to enter into an exclusive arrangement with only one FDM, IBs are limited in where they can refer customers, which creates a conflict of interest and is not aligned with the best interest of the customer. Independent IBs bring a valuable service to the retail trader. By carefully matching a trader\u2019s style and needs with the right broker as it relates to spreads, trading platforms and customer service offerings, independent IBs help retail customers make the decision that\u2019s right for them. Furthermore, these proposed rule changes are contradictory to the current CFTC policy in place for the on-exchange futures market, which allows independent IBs to introduce business to multiple Futures Commission Merchants thus enabling IBs to do what is in the best interest of their clients. The IB Coalition views the CFTC proposed rules as needlessly restricting legitimate Forex activities and capable of pushing Forex business off-shore, creating new opportunities for non-regulated or fraudulent businesses who don\u2019t care about U.S. regulatory requirements.<\/p>\n

The IB Coalition recently submitted a 10-page letter to the CFTC<\/a><\/span> and, among other points, suggested the following changes to the proposed rulings<\/p>\n