Customer Complaint Dated March 4th 2025

Complaint Matter

Mr. XXX has lodged this complaint with the Financial Commission on the following grounds:

The Client used accounts ## XXX (USD), XXX (USD) for active operations with the financial instruments of the FX market.

According to the Client, in the period between February 27, 2025 and March 4, 2025 an error occurred in the margin displayed on the screen of the MetaTrader 4 platform provided by the Broker. The Client claims that the Broker’s staff confirmed this error via a documented video call. The error allegedly altered Margin Levels without justification, preventing the application of the Client’s progressive risk management protocol. Consequently, on the day of the incident, March 4, 2025, in the period between 14:00 and 15:12 the Client was allegedly forced to manually close the disputed positions with the financial instrument EURUSD to avoid losing his entire trading capital. According to the Client, this resulted in losses totaling 655,746.19 USD. The factual amount of financial losses realized by the Client on trading accounts ## XXX, XXX was 183,977.78 USD (94,055.22 USD for account # XXX and 89,922.56 USD for account # XXX).

The Client does not agree with the Broker’s decision (see below), accuses the Broker of misconduct and holds the Broker responsible for the financial losses caused by the incident. According to the Client, they had sufficient margin to maintain open positions during the period of the incident. However, since the margin calculation was incorrect, their entire strategy and operations were seriously affected. This led to wrong decisions based on manipulated or inaccurate data. The Client believes that a fair resolution of the dispute would be a full refund of USD 655,746.19, corresponding to the losses caused by the Margin Level error on the Broker’s platform. The Client has provided the investigation with the extracts of trading history for trading accounts ## XXX, XXX, in two separate moments:

1. Pre-incident, when the margin was clearly miscalculated.
2. Post-incident, when the margin appears to be correctly calculated again.

In turn, the Broker does not see any grounds for the Client’s complaint, since the Client has failed to provide any solid evidence in support of the allegations. In the Broker’s opinion, the four extracts of history of trading operations carried out on both Client’s accounts are not entirely relevant for the analysis. Moreover, even based on the limited materials provided by the Client, it is evident that the alleged loss of 655,746.19 USD is neither substantiated nor reasonably supported and appears significantly exaggerated. The Broker has provided the investigation with the history of trading operations performed by the Client on both accounts, as well as the server log records for the period of the incident, as documentary evidence.

Complaint Response

The decision on this complaint is based on the information provided by the Broker and Mr. XXX.

After a comprehensive analysis of the documentary evidence provided by the Client and the Broker the Dispute Resolution Committee of the Financial Commission has come to the following conclusions:

1. First of all, it should be noted that according to the information received from the Broker:
2. a) Although the Client claims to possess “20 attachments supporting the incident: screenshots, previous account statements, recordings, correspondence, and our own monitoring panel,” and despite the Financial Commission’s request for detailed supporting documents, the Client has failed to provide any solid evidence in support of the allegations.
3. b) While the initial complaint refers to losses allegedly incurred across “multiple accounts,” the evidence submitted concerns only to two specific accounts. No solid explanation has been provided as to why the scope of the complaint was narrowed to only two accounts following the request for supporting documentation.
4. Second, in the Broker’s opinion, the Client’s claim that an alleged Margin display error caused a material trading loss is both factually and technically flawed. In this regard, the Broker deems it necessary to note the following:
5. a) Margin levels displayed on the trading platform do not restrict or prevent trading activity as such. Instead, Margin Levels serve two primary functions:
6. They impact the operation of the platform’s automated Stop-Out mechanism, as outlined, inter alia, in section 2.1.4 of the Rules for Trading Operations; and
7. They determine the availability of funds required to open new positions.
8. b) In the present case, as per Broker’s investigation, system logs and the Complaint itself, the Stop- Out mechanism was not triggered, and therefore not implicated.
9. c) Even if the Client did observe an incorrect Margin Level on screen (a fact that the Broker does not confirm), the platform logs contain no record of any attempt to open a position that was subsequently denied due to insufficient margin.

Considering all the above, the Broker is in the opinion that all positions opened by the Client were within the bounds of the actually available Margin, and that the alleged Margin discrepancy had not and could not impact on the Client’s trading activity.

3. Third, the Client claims that incorrect information about the Margin Level in the Broker’s trading platform was the cause of the incident and led to erroneous trading decisions on his part. In order to verify the validity of the Client’s arguments, the DRC conducted an analysis of the documentary evidence provided by both parties to the dispute, which showed the following:
4. a) The Client’s trading strategy can be characterized as follows:

• The Client traded both Long and Short short-term positions in the financial instrument EURUSD.
• The Client used pending Take Profit orders to lock in profits on open positions.
• The Client never used pending Stop Loss orders to limit losses on open positions.
• The Client used hedging strategy instead of fixing unrealized losses on open positions.

80. b) Several hours before the incident, on March 3, 2025, at 18:11:32 (server time), the Client had the following market exposure for the trading account # XXX: Short EURUSD 80.72 lots
81. c) The key parameters of trading account # XXX at the specified time were as follows:

‘XXX’ deposit=101355.56 credit=0.00 equity=55911.73 margin=40213.94 free_margin=15697.79 free_real=15697.79 free_credit=0.00 [0 ms]

1. d) The leverage set by the Broker for the Client’s trading account # XXX was as follows:

Aggregate position size in USD Leverage* Forex Pairs FX Majors Less than 1 mil. 1000 1 million – 5 mil. 500 5 million – 10 mil. 200 10 million – 20 mil. 100 Over 20 mil. 5

80. e) As such, the calculations show that for the market exposure the Client had at that time in his account # XXX (Short EURUSD 80.72 lots), the amount of Margin required for maintaining open positions should have been:

(10*100000*1.04953/1000) + (40*100000*1.04953/500) + (30.72*100000*1.04953/200) = 25566.55 USD

instead of 40213.94 USD, i. e. 57.29% less than the actual one at that time. Thus, at the specified time, the Margin Level on the Client’s account was:

55911.73/40213.94 = 139.04%

instead of the correct number that should have been:

55911.73/25566.55 = 218.69%.

78. f) In the period of the incident, i.e. on March 3, 2025, at 19:55:19 (server time), the situation on the Client’s account # XXX was almost the same, as described above. The calculations show that for the market exposure the Client had at that time (Short EURUSD 78.10 lots), the amount of Margin required for maintaining open positions should have been 27.1% less than actual: (10*100000*1.04964/1000) + (40*100000*1.04964/500) + (28.10*100000*1.04964/200) = 24194.20 USD

‘XXX’ deposit=102091.95 credit=0.00 equity=65368.30 margin=30751.17 free_margin=34617.13 free_real=34617.13 free_credit=0.00 [0 ms]

4. Fourth, on one hand, it can be stated with some degree of certainty that during the incident, the Client could have been guided by incorrect data on the Margin Level in the Broker’s trading platform, and seeing the risk of a complete loss of all his trading capital, decided to fix unrealized losses on open positions. On the other hand, from the point of view of DRC experts, the following scenario can be considered no less (and perhaps even more) likely to develop during the incident: the Client, after gradually increasing the volume of aggregate Short position, accumulated significant unrealized losses on it, while not leaving a single hedging Long position, since he prematurely closed them all with profits. Ultimately, the Client realized his mistake in determining the direction of the price dynamics of the financial instrument EURUSD, and decided to take advantage of the situation with the incorrect display of the Margin Level in the Broker’s trading platform to justify his actions during the incident.

The DRC believes that it is impossible to determine which scenario was most likely with certainty.

Considering the circumstances of the case, the experts of the DRC have made their decision in favor of the Client. The DRC believes that partial compensation of at least 25% of the Client’s financial losses would be a fair solution in this case. In the general opinion of DRC experts, full compensation for financial losses is not appropriate in this case because:

1. a) The price dynamics of the financial instrument EURUSD following the incident would ultimately result in the Client losing all his funds.
2. b) The Client did not contact the Broker to clarify the situation regarding the incorrect margin level display before closing the unprofitable positions.

This complaint was reviewed by the members of the Dispute Resolution Committee of the Financial Commission and was processed by the Head of the Committee.

If you have any questions regarding this investigation, please send them to the following address: info@financialcommission.org

Acknowledgement

I certify that all information was considered by the Dispute Resolution Committee of the Financial Commission and hereby confirm that the decision was made fairly, impartially and without interference. I am confident that the information provided in the document is true.

Awards and Orders

• DRC decisions are binding on Brokers. DRC decisions are binding on clients only if they accept them.
• If complainant agrees with DRC’s decision, he’ll need to accept it within 14 days. If the Client does not respond to the DRC’s decision within 14 days the complaint is considered closed.
• Member must award the settlement within 28 days of when the decision was reached.
• If the decision was in favor of the Member, the Client must provide a release for the Member within 7 days of when the decision was made and the complaint is considered closed.
• The Compensation Fund will be only used should a Member refuse to adhere to a judgment from the Financial Commission or if a Member is removed from the Financial Commission without paying their outstanding judgments.
• The Compensation Fund will only cover judgments up to €20,000 per client.