FXLQ Shut down temporarily by NFA
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Thread: FXLQ Shut down temporarily by NFA

  1. #1
    WOW....This will affect several IB's.
    Link to the case action: http://www.nfa.futures.org/basicnet/...013contrib=NFA

    They Can't accept any new postions/trades/etc...

    Copy of email.
    Tuesday, December 04, 2007

    RE: Account # XXXXX

    To our Valued Clients:

    The National Futures Association has today issued a Member Responsibility Action against FXLQ. You can discover the notice on the NFA's site: http://www.nfa.futures.org/basicnet/...id=0362216rn=Y.

    Effective immediately, FXLQ isn't allowed to undertake any new client rankings. Therefore, our systems are set to permit just rollover and liquidations.

    We apologize for any inconvenience this has caused, and guide you to our site should you wish to withdraw your capital: http://www.fxlq.com/docs.

    We are working diligently to clean this up as quickly as possible and look forward to renewing a full connection with our clients.


    Robert Gray


    Forex Liquidity LLC

    ------------------------------------ and:


    On December 4, 2007, NFA issued a Member Resonsibility Action (MRA) against FXLQ where:

    1. Effective immediately, FXLQ is banned from soliciting or accepting any additional customer accounts or client capital, except as security deposits for existing positions. The prohibition on solicitation contains quitting solicitation through the firm's website.

    2. Effective immediately, FXLQ is banned from accepting or placing trades for almost any client accounts except for its rollover or liquidation of currently existing client rankings. FXLQ must get the ongoing assent of clients to rollover any customer's existing rankings.

    3. FXLQ is required to liquidate all Forex positions held in any account for FXLQ or some other FXLQ main except for positions that are held to offset FXLQ's exposure resulting from its clients' rankings by 3:00 p.m. (PST) on Wednesday, December 5, 2007, and, further, is prohibited from initiating any extra positions in such accounts.

    4. FXLQ is banned from distributing, disbursing or moving any funds, such as to existing clients, without the previous approval of NFA.

    5. Unless otherwise authorized by NFA in writing, FXLQ should transfer all assets not currently held in US Bank or a NFA Member FCM to US Bank or a NFA Member FCM by 3:00 p.m. (PST) on Wednesday, December 5, 2007, and provide documentation that such transfer has happened.

    6. FXLQ is required to make to NFA financial statements such as net capital computations as of December 4, 2007. The financial statements should correctly reflect all assets and obligations as well as the firm's current funding position as well as a list of all current assets and obligations and provide third party documentation supporting the existence and loion of these products.

    7. This MRA shall remain in effect until such time as FXLQ has demoned to the satisfaction of NFA it is in complete compliance with all NFA requirements. In making such a demonion FXLQ should provide NFA with an internal control report and certified financial statement, which can be prepared by an independent public accountant who's registered under Section 102 of the Sarbanes Oxley Act and has demoned experience and competence in auditing matters required under Section 404 of the Sarbanes Oxley Act.

    The internal control report shall include, at a minimum, a comprehensive explanation of the examination performed by the accountant and a representation from the accountant that it has analyzed and analyzed FXLQ's system of internal controls to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accore with generally accepted accounting principles (GAAP), such as those policies and procedures that:

    a. Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets and client obligations of FXLQ;

    b. Provide reasonable assurance that the transactions are recorded as necessary to permit preparation of financial statements according to GAAP, and that receipts and expenditures are being made only in accore with authorizations of management and directors of FXLQ; and

    c. Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of FXLQ's resources and client obligations that could have a material impact on the financial statements.

    The internal control report must have a representation from the public accountant that it has found FXLQ's system of internal controls doesn't have material weaknesses and it is adequate for establishing and maintaining internal control over financial reporting by FXLQ.

    8. In taking any action under this MRA, FXLQ should act in the best interests of its clients.

    This activity is effective immediately and is deemed essential to protect customers because FXLQ has failed to demone that it satisfies the funding requirements of NFA Financial Requirements Sections 1 and 11. Additionally, FXLQ provided materially false or misleading information to NFA.

    The MRA will remain in effect until such time as FXLQ has demoned to the satisfaction of NFA it is in complete compliance with all NFA Requirements. FXLQ is required to provide copies of this MRA, by overnight courier, to all its clients, to all banks and other financial institutions with which it has cash on deposit, and to all persons that solicit or introduce clients to FXLQ or who manage customer accounts held in FXLQ.

    I think most in the USA will begin looking offshore to trade FX. . .seems the NFA in america is trying to shut everyone down slowly but surely (?)

  2. #2
    Can't teach a old dog such as grey new tricks.

  3. #3
    Quote Originally Posted by ;
    I think many in the USA will begin looking offshore to exchange forex. . .seems the NFA in america is trying to shut down everyone slowly but surely (?)
    There just trying to protect against another refco from occurring, fantastic job by the n.f.a.

  4. #4
    Quote Originally Posted by ;
    there just trying to prevent another refco from Occurring, good job from the n.f.a.

  5. #5
    The NFA is far from great but by shutting down these guys they don't just protect the consumer but hopefully will also entice legitimate players to the market. While it is excellent to have a large assortment of choices to trade, it isn't great to have a whole bunch of these be little and scam artists. I really don't know why the NFA is not as strict as the SEC. It.

  6. #6
    Quote Originally Posted by ;
    The NFA is far from perfect but by shutting these guys down they don't just protect the user but ideally will also entice legitimate players into the market. While it's excellent to have a massive variety of options to trade with, it is not good to have a whole bunch of these be small and scam artists. I don't understand the NFA is not as rigorous as the SEC. It.
    There getting there, im glad there here.

  7. #7
    Live conversation with interbankfx.

    Thank you for calling us. The next available agent will probably be right with you. Our goal is quality service. You may tell us how exactly we do now by http://www.interbankfx.com/ClientSer...tFeedback.aspx
    You are now chatting with 'Client Services 50'
    Client Services 50: Hello, this is Chris. How may I assist you?
    You: it is a known fact that interbankfx uses fxlq as there liqutiy provider, with instance against fxlq by n.f.a. it disturbs me
    you: whats going on with this
    Client Services 50: only a minute
    you: please clarify and be honest
    you: ok
    Client Services 50: They're among our liquidity suppliers but we don't use them
    you: only last month on the forum you guys say you where using them, since when things change
    Client Services 50: we utilize a number of
    Client Services 50: liquidity suppliers, they were only 1
    Client Services 50: due to the NFA actions, we no longer these
    you: just how many liquidity suppliers do you have and can be interbankfx a non-dealing desk broker
    Client Services 50: We do have multiple ventures which include but not limited to Citibank, Deutshe Bank, Bank of America, Barclays and Goldman Sachs. These can change at any time and new suppliers can be inserted without notice.
    You: is interbankfx a non-dealing desk broker
    Client Services 50: yes, this remains the same
    you: well just how or trades cancel do we trade with all the banks or do you guys have to cancel the transaction
    Client Services 50: we provide you the best price from our liquidity suppliers, we pass your trades directly to them, of course they've a dealing desk as they are the ones filling your trades,

  8. #8
    Given that InterbankFX started using bucket shop tactics since the beginning of this season, this is hardly surprising since their principal liquidity supplier is FXLQ. As Moe points out this was cited many times on IBFX forum with their own reps. Recently though the IBFX forum was pulled down.

  9. #9
    Justed wanted to say thanks to the members for this notifiion. I just requested my capital be pulled so we'll see what happens. LOL

  10. #10
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