I still can't believe how the CFTC accepted the inclusion of a fake bond in the balance sheet

We assume that the report posted by the CFTC are liquid assets held on well know US institutions.

FXLQ should be investigated right know for fraudulent declarations and cooked books.

And CFTC should take responsibility for present a misleading information to customers.

We also need a major change on laws to issue a Investor Protection similar to Canadian laws.

The last extraoficial information show that FXLQ liquid assets don't reach 50% of the money needed to cover creditors and customers accounts.

If the missed money appear, a fast solution can arrive in 1 or 2 months, or 1 to 3 years if not.

At this stage, this case sound very similar to Neuimex or Refco.

__________________
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Nope IBFX no longer use FXLQ Robert Gray's name taken off them on NFA site since 2005.I believe they used to use his services but not for 2 years now.
I remember when they did because trading with them was completely crap.
It still is crap but better than then.
I asked them if IBFX accounts have problems they said NO.
October 2005 Robert Gray was withdrawn as principal in IBFX I believe they had some short term partnership which due to his scamming was quickly dissolved.

__________________
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I know for a fact 100% certain, and both Mr crosland and Mr gray were claiming the same thing to me. That FXLQ has been the liquidity provider for IBFX since beginning 2007 (When i had an account with them). But the dirty dealings of FXLQ made me leave ages ago.

FXLQ's downfall shouldnt really effect IBFX for now if at all... As they are 2 seperate firms. And the funds have to be diversified. But expect some bad stop hunting and spreads on IBFX if i were you. (Thats out of the ordinary stop hunting and spreads)

NFA is on the war path right now. This is the fifth poorly capitalized firm they sanctioned this week. velocity4x is closed to introducing brokers (but not all customers). If you are a customer of Hamilton Williams or Velocity4x or whatever the hell they call themselves get your money out now. And for the Love of God stay away from poorly capitalized firms! They are dropping like ten pins.

BASIC Case Summary

I know FXDD is not regulated but is it safe to trade with?

With all these other firms being closed surely it will attract more business?

Thanks for the information you are providing

Thanks for the heads-up Forexsavior.

With all these small time guys going down who is safe? I mean what broker can be trusted?

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The NFA is as busy as the Post Office on Tax Day. I haven't even had a chance to chew over the closing of FXLQ or One World Capital yet due to the continuing complaints and emergency actions the NFA is cranking out this week. Nor have I gotten a chance to talk about the Solid Gold or Velocity4x complaints. That's because the Savior must prioritize. And the latest priority is a forex firm that went by the name of Tradeco which just got banned for life by the NFA. BASIC Case Summary

Frankly I had never even heard of this company before the NFA banned them yesterday. But I have heard of their former principal, Mr. Ryan Nettles. It seems like Nettles has been involved in every forex boondoggle of the last decade. There is the Tradex debacle and the Finex Fiasco. And there was a dodgy outfit per Forex Bastards by the name of Futures and Options of Texas that went out of business in 2001: TradeX Swiss AG Reviews | TradeX Swiss Ag Ratings | Tradexfx.com reviews and ratings

In short, Mr. Nettles gets around. Between 1997 and 2004 Nettles was registered with six different futures firms with the NFA: BASIC Details

Today most of those firms are out of business. But it wasn't until 2004 that Nettles really seemed to hit his stride.

For it was in 2004 that Nettles applied to be a principal with the Tradex Group. Ah yes, Tradex. The very name of this firm makes the bile rise in one's throat. The Tradex Group was banned in 2006 by the NFA and earlier this year the mutated offspring of the Tradex Group, Tradex Swiss AG, was shut down in Switzerland and then thrown into bankruptcy leaving legions of traders stranded in purgatory.
BASIC Case Summary

The implosion of the Tradex Group in 2006 was the source of a humorous article in Euromoney in which Craig Karlis of Tradex Swiss AG infamy and Ryan Nettles were at each other's throats like a couple of pitbulls from Michael Vick's Badnewz kennels. While the article is firewalled here are some choice quotes that indicate Nettles won't be able to get a good reference from his old employer anytime soon.
(FX trading: Let the mud slinging begin / / Euromoney magazine)

Karlis is quoted as saying, "Mr Nettles, while employed by Tradex Group, took it upon himself to start a CTA. he did this without Tradex knowledge. When that happened he put Tradex Group in control of the NFA... He had all his commissions sent to an account in the Bahamas. He Also had a dealing desk that offset all positions... After an audit all this information was revealed."

Nettles countered that, "I was just an employee. They told me to do this." Of course, he was just following orders. Where have I heard that before? In the end Nettles stated that, "He's pissed off at me for some reason. I also took my customers away from Tradex. That's why he's all pissed off at me." Ya think?

Question is where did he go to after his falling out with Karlis? Well Nettles isn't one to head over to the unemployment office and go on the dole. No Nettles quickly jumped ship and joined the doomed ocean liner: Tradeco Clearing Group LLC. Tradeco was actually the 100th firm to use Metatrader per a press release from the company. But after two months though Nettles hit the road and left Tradeco, he was after all born a rambling man.

But that didn't stop the NFA from issuing a complaint against nettles a year later. Indeed, it is a very strange case. Tradeco officially withdrew their membership from the NFA in August of 2007, one month before the NFA filed a complaint against them for fraud and failing to meet their capital requirement.

Furthermore, I can find no record of Tradeco on the CFTC capital reports at all for 2007. In fact, their last CFTC report was filed in August of 2006 when they reported that they were $750,000 below the minimum capital requirement. That's right, only a few months after they got their license they were not only violating their capital requirement, but failing to file any financial reports and still allowed to stay in business. That's an impressive accomplishment.

So what finally set the NFA off? It looks like they discovered all this during a 2007 audit of the firm. They must have done it right before Tradeco closed their doors. The examination is good for a laugh however. Highlights to come in Part II.

We pick up the story in the summer of 2007. Tradeco is still technically in business although Nettles has long since cut his official ties to the firm. Here are the highlights of the NFA's complaint:

Two words: BUCKET SHOP

Bwahahahaha! Let that be a lesson to everyone. Just because someone throws up a website and makes grandiose statements doesn't mean they're legit.

Ah yes, the old "Fidelity 14 bond." I have seen firms toss this old lemon around in the forex industry to try and ease the concerns of customers worried about the safety of their funds. Whenever you see this old dog dragged out of the kennel that should sound the alarm bell in your head to put your money elsewhere as few serious brokers try to pawn that off on their customers.

Later in the complaint the NFA calls out Tradeco for not only failing to meet their capital requirements but for failing to even keep a general ledger. Guess that's why we never saw any reports on the CFTC website this year...

So who is to blame for this mess? The NFA tried to pin the blame on Nettles since he was "The director of operations for Tradeco and the firm's AML compliance officer. Accordingly, Nettles had supervisory responsibilities with regard to Tradeco's activities."

But Nettles strongly disagreed and in his response to the NFA's charges basically denied everything and said he had nothing to do with it. The NFA has not rendered a decision on his culpability, but they did find Tradeco guilty on all counts. Only problem is Tradeco no longer exists. No one ever replied to the NFA complaint which is probably still sitting in some over stuffed mailbox with all of Tradeco's other bills, flyers and court summonses. Talk about beating a dead horse...

So where is the running man today? Well last anyone heard he was involved in the "Finex Group." Traders at Forex Factory put the word out on Finex earlier in the year (Swiss Law and Dukascopy.com/Finex.com - Page 2) and sure enough a few months later Swiss authorities swooped in to freeze all of Finex's accounts (Finex - Beware). In a rather droll email Finex agents told their customers:

No reason to be alarmed?! With Ryan Nettles on the scene traders should have EVERY REASON TO BE ALARMED. Of course they can always, "move to another country." And so the running man just keeps on running. Run Ryan! Ruuuuuuuuuuuuuuuuuuuuun!

Today the CFTC issued their final report on Net Capital before the new $5 million capital requirement rule goes into effect.
Financial Data for FCMs

While this report details balances as of only October 31, it is the last piece of independent data the public can use before the bell tolls in a few weeks. And don't think these firms don't know that. Furthermore, in light of the FXLQ scandal, the numbers you see here are more likely to be overestimates of how much capital these firms have so be sure to factor that into the equation.

At this point in time any firm that still isn't reporting capital of over $5 million should be avoided by the trading public at all costs. The risk is too large and as One World Capital has shown it just isn't worth it. The following 10 firms should be avoided at this point in time as they are at high risk for going out of business. If you have money with them, take it out, NOW.

1) SNC Investments: $1,152,000
They are well below the $5 million capital requirement. It is highly unlikely they will make the new requirement at this point. I advise customers to leave this firm and look for greener pastures.

2) Wall Street Derivatives: $1,228,000
This firm is based out of New Zealand and I'm not even sure they have any U.S. customers as their U.S. website is out of service.

3) Advanced Markets: $1,322,000
Amifx is already teetering on the brink as they are the subject of a business conduct committee case before the NFA in which they are cited for a whole host of financial violations including not meeting the old capital requirement. This firm does not have much of a future.

4) Hamilton Williams (VelocityFX): $1,345,000
This firm is a train wreck. They just got fined $90,000 by the NFA for not meeting the old capital requirement. Then they lost their liquidity provider when FXLQ got shut down. Now they can't accept any customers from their unregistered introducing brokers. This firm is literally on life support. Do yourself a favor and stay the hell aware from them before the regulators pull the plug on them once and for all.

5) Solid Gold Financial: $2,040,000
Solid Gold's future is now in serious doubt. Like many of the other firms on this list they have been charged by the NFA with failing to meet their existing capital requirement. When you can't meet the old requirement it stands to reason you won't be able to meet the new one either. Solid Gold is anything but a solid investment at this point.

6) Bacera Corporation: $2,300,000
Like a turd that won't flush Bacera Corporation just refuses to go down the drain. The Savior wrote Bacera off over the summer as sources knowledgeable about them stated they were going to close up shop. But no, they are still hustling the folks in LA for fresh deposits. In September Bacera settled a complaint with the NFA after it was discovered they were undercapitalized to the tune of $1.2 million. NFA reported Bacera only has about 200 customers as it is. But to those 200, do yourself a favor and get yourself another broker because sooner or later the pipes are gonna get cleaned and these guys are going to get flushed once and for all.

7) GFS Futures & Forex: $2,353,000
This firm is in an especially tight fix. They offer 200:1 leverage which means they need to come up with $10 million. And as this number shows they are far, far away from that.

8) Forex Club: $3,320,000
They still have not hit the minimum $5 million mark. And don't forget since they are a market maker they have other financial requirements to meet as well. They still haven't publically done so.

9) Easy Forex: $3,789,000
Under siege for their sleazy sales tactics, it's hard to imagine the NFA isn't going to drop the hammer on them soon.

10) Money Garden: $5,035,000
While they have crept up over the $5 million mark MG is notorious for their 400:1 "flexi" accounts which will require MG put up a minimum $10 million in capital in addition to other financial requirements for being a market maker. They are not even close to doing this despite their CEO's insistence they could easily get the money last summer. It looks like this veteran of the industry is about to be forcibly retired.

And so this is where we stand as of Friday, December 7, 2007. The new $5 million capital requirement kicks in on Friday, December 21, 2007. Two weeks to go. Tick Tock. Tick Tock.