FTI Consulting, liquidators at Forex Capital Trading (ForexCT), have informed their 8,600 clients that they can claim losses against the company due to its actions. According to the Financial Review, Forex Capital Trading was found guilty of systematic unreasonable conduct that resulted in a $400,000 fine and a 10-year company ban on Shlomo Yochai, its sole director.
As a result of this decision, the company was ordered to pay $20 million to the company’s regulator who brought the lawsuit against the trading company. In 2019, ForexCT’s operating license was revoked following a raid by the Australian Federal Police. However, the Financial Review says the fine may not be paid due to ForexCT’s current cash balance, citing observers familiar with the matter.
In a statement, the ForexCT liquidators said: “We had a duty to investigate any debts owed by the Company or possible future claims against it – after reviewing the judgment, FTI Consulting has proactively determined that former clients of Forex may have claims against Forex due to investment losses, given Court findings.
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141.86 million dollars in total losses
As of press time, FTI Consulting has received 800 responses, and Financial Review has highlighted that total client losses from the company amounted to $141.86 million. Its realized profits amounted to $64.26 million, and its net realized losses were $77.62 million. In the first place, ForexCT was expected to face a maximum penalty of $70 million, but the Australian Securities and Investments Commission (ASIC) told the court that both Yoshai and the trading firm were cooperative during the inquiries.
Last year, in an unrelated case, the US Commodity Futures Trading Commission (CFTC) fined OANDA $500,000 for failing to comply with certain regulations, including failing to meet minimum capital requirements. The accusations were that OANDA failed to meet the minimum financial requirements for RFEDs and FCMs and violated stock withdrawal restrictions that resulted from paying dividends on three occasions.