CFTC alleges Forex Broker JAFX of carrying out financial services activities in the US without any valid registration. The regulator noted that the Bulgarian broker JAFX has misrepresented its revenue probability and risk loss to customers.
1 August, AtoZ Markets – One of the US regulatory bodies, the Commodity Futures Trading Commission (CFTC) has alleged a Bulgarian Forex brokerage that it acquired funds from the US traders by conducting retail foreign currency trades without any valid registration.
CFTC alleges Forex Broker JAFX of operating in USA without license
The CFTC noted that the offshore unregulated broker JAFX has misrepresented its revenue probability and risk loss to customers. In addition, it has never disclosed that it was acting as a counterparty to Forex transactions without any proper registration in the US.
The regulator states that in the period between September 2016 and now, JAFX has breached the Commodity Exchange Act (CEA) and CFTC rules. It did so by not registering as a retail foreign exchange broker with the regulator while at the same time soliciting and accepting orders from some of the customers in the country.
As per the website of the brokerage, it has been active since 2013 and it operates in the jurisdiction of St Vincent and the Grenadines. The firm also claims that it offers a true ECN/STP brokerage and provides the MetaTrader 4 platform. Moreover, the company’s payment services are managed by JAFX EOOD, which is located in Sofia, Bulgaria.
CFTC seeks permanent registration and trading bans
The CFTC states in its announcement:
“Customers are directed to open trading accounts by submitting an online account application through JAFX’s website, and JAFX encourages customers to access and trade their accounts via a mobile application, according to the Complaint. U.S. customers allegedly may open an account with JAFX for as little as $100.”
The regulator has asked the court to provide full restitution and disgorgement of ill-gotten gains and to pay the appropriate civil monetary penalties. Additionally, the watchdog seeks permanent registration and trading bans and a permanent injunction from future breaches of federal commodities laws for a company.
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