Earlier this month, two well-known New York-based brokerages were requested to pay $37.5M to the Commodity Futures Trading Commission (CFTC) to settle forex fraud claims. According to the authorities, BGC Financial, LP, and GFI Securities, LLC, were involved in fraudulent foreign exchange currency options and violated the Commodity Exchange Act.
Earlier this month, both firms agreed to pay $15M and $10M, respectively, to the CFTC. Additionally, the companies were sentenced to pay over $5M to the New York Attorney General's Office to resolve other claims. Some of which included the violation of the Martin Act (one of the most potent "blue sky" laws in the country).
BGC Financial to Pay $15M
As a result, BGC Financial will pay $15M in total. GFI Securities, on the other hand, will give up $10M.
Although the news recently came to light, the CFTC and the Attorney General's office had been working on the investigations into these forex fraud claims for the past three years.
In other words, the two firms in question deceived New York-based traders from 2014-2015 by using manipulative tactics such as "flying prices" and "printing trades."
However, it does not end here, the companies' agreement with the CFTC and the state of New York require them to take additional actions. Consequently, both firms increased their internal controls and included stringent hiring and training policies. Moreover, an independent monitor was placed in both headquarters to report back to the authorities.
As a result, BGC Financial will pay $15M in total. GFI Securities, on the other hand, will give up $10M.
Although the news recently came to light, the CFTC and the Attorney General's office had been working on the investigations into these forex fraud claims for the past three years. In other words, the two firms in question deceived New York-based traders from 2014-2015 by using manipulative tactics such as "flying prices" and "printing trades."
However, it does not end here, the companies' agreement with the CFTC and the state of New York require them to take additional actions. Consequently, both firms increased their internal controls and included stringent hiring and training policies. Moreover, and independent monitor was placed in both headquarters to report back to the authorities.
As a result, BGC Financial will pay $15M in total. GFI Securities, on the other hand, will give up $
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