Case Examples

In this section we will publish a random selection of cases to assure our Members and their Clients that the disputes are being handled properly.

Customer Complaint Dated April 29, 2016

Complaint Matter

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

The Client used account #XXXXX for trading operations in the Forex and CFD markets. The incident occurred on 29.04.2016 shortly before the end of the US trading session on Friday. By the time of the incident, the client established a SHORT position in USDJPY:

27464405      29.04.2016      18:00      sell       15       usdjpy         106.894        107.453        0.000

According to the Client, he placed his Stop Loss order at 107.453 price level, however, the Take Profit order was not set, because the trade was under his full control. After a short period of time, the client’s position was closed by Stop Loss order with a slippage of several points.

The client does not agree with the actions of the Broker and believes that his position was closed at the non-market price. This follows from a comparison of USDJPY price graph in the platform of the Broker with the similar price graphs of other financial services providers.

The client considers the actions of the Broker as unfair and requires:

– to recover funds lost due to improper closing of the short position ($8469.69);

– to compensate for unrealized gains on closed position in the amount of $26150.

For its part, the Broker believes that the Client’s complaint has no ground because his order was executed at real market prices. In support of his decision, the Broker provided the investigation with the server log records and the screenshot of the 1m chart of the instrument.

In addition to the above, the Broker refers to the paragraph XX.XX of the Terms of Business, according to which “The Trading Server of the Broker is the only reliable source of quotations, by which any relationship between both Sides arising from the Customer Agreement, the Terms of Business and other documents of the Company will be governed.”

Complainant Broker
XXX YYY
Financial Commission Complaint #ZZZ
Complaint Raising Date Complaint Filing Date
29/04/2016 7/06/2016
Complaint Response:

The decision for this complaint is based on the information provided by Mr. XXX and Broker YYY. In order to investigate the incident and to make an objective decision on the complaint, the Dispute Resolution Committee of the Financial Commission closely examined the price dynamics of USDJPY in the period before and after the incident.After a comprehensive analysis of the market situation in the USDJPY instrument at the time of the incident, the Committee concluded that there were non-market prices in the quote feed of the Broker.

Thus, the Committee considers that the transaction, which resulted in a Stop Loss order execution, should be canceled. Broker must compensate the losses incurred in a transaction # 27464405 in full ($ 8469.69).

As for the customer’s requirements on partial or full reimbursement of the amount of unrealized profit, which was lost because of Broker’s misconduct, the Committee considers that this is not acceptable, because the Client did not indicate his intentions with respect to his open position, and it cannot be assumed what kind of actions he would take in relation to his position otherwise.

In addition, the Committee members consider unacceptable the restoration of the Customer’s position after a long period of time, and in connection with the inability to initiate the trade at the original price.

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.

Ruled in Favor Compensation
Client $ 8469.69
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.
Signature Designation Date
 Anatoly Bulanov

Head of DRC

8/07/2016

 

Customer Complaint Dated November 15, 2014

Complaint Matter

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

The client claims that Broker (Company) has made a deletion/restoration of a series of closed EURRUB transactions on his account in accordance with paragraph 9.9 and 9.22 of the «Terms of Business» with a formulation “non-market quotes”.

In client’s opinion, the Company is trying to represent these quotes as a technical failure in violation of paragraph 16.1 b of the “Client Agreement”, namely, changing trading conditions retroactively when the benefit of these terms was recorded on the client’s account.

The client admits that the Company offers more advantageous trading conditions than the competitors what allowed him to gain a profit on a high-volatility market, however, he believes that any technical failures or non-market quotes did not take place during the reporting period.

In his own defense the client provides the following arguments:

1. The case does not fall under the last condition of paragraph 10.1 of the “Terms of Business” referred to by the Company. According to the paragraph 10.1 of the “Terms of Business” non-market quotes or spike is an error quote with the following characteristics:

a) a significant price gap;

b) a price rebound in a short time period within a price gap;

c) no prior rapid price fluctuation before the spike;

d) no released macroeconomic indicators and/or corporate reports that could influence the price.

2. In client’s opinion an example of non-market quotes provided by the Company’s on its website has nothing to do with the EURRUB quotes in the reporting period.

3. The client has provided a screenshots of the tick charts on EURRUB currency pair of other companies where such high-volatility quotes were registered.

Consequently, the client demands restoration of the trading history by the time of market closing on the 7th of November 2014 or monetary reimbursement in the amount of 4742.62 USD without restoration of the trading history.

Complainant Broker
XXX YYY
Financial Commission Complaint #ZZZ
Complaint Raising Date Complaint Filing Date
15/11/2014 1/12/2014
Complaint Response:

The decision for this complaint is based on the information provided by Mr. XXX and Broker YYY and the analysis of the market situation of the EURRUB instrument in the given time period.

1) In the reported period Russian Ruble was very unstable, the market experienced increased volatility and low liquidity. In such cases any news or activities of the Central Bank or any other large participant of the market may lead to big price fluctuations;

2) The client did not change his trading strategy during the reported period and did not try to deceive the Company. According to the Company’s report it could be seen that the client has never shown an aggressive trading behavior and also, that the client has never changed his trading strategy in the similar conditions;

3) The Company should not change the trading conditions retroactively and should consider possible rate fluctuations of the RUB instruments. Closing of the profitable transactions in non-liquid time cannot be regarded as a reason to refuse client in a payment;

4) The Company has enough tools to limit its risks when trading during the hours of low liquidity, especially for instruments that are generally low liquid. In particular, to make a special set of rules for such instruments;

Based on the above information the Dispute Resolution Committee considers the client’s complaint reasonable and believes that the Company must satisfy it.

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.

Ruled in Favor Compensation
Client $ 4742.62
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.
Signature Designation Date

Head of DRC

1/12/2014

 

Customer Complaint Dated November 17, 2015

Complaint Matter

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

The incident occurred on November 6, 2015 during the publication of Non-Farm Employment report in the US.   Prior to the incident the balance of client’s account was 13501 RUR. The client had several opened positions in EURUSD, the total volume of client’s short position in EURUSD amounted to 80000 units of base currency. Just before the publication of the report the client placed three additional Sell Stop pending orders:

146331265   06.11.2015 sell  0.20  EURUSD   1.08500 (was not executed due to lack of funds)

146330490  06.11.2015 sell  1.50  EURUSD    1.08300 (order was executed)

                       06.11.2015 sell  1.50  EURUSD   1.08000 (order was not executed)

At 13:30 GMT there was a period of increased market volatility caused by the publication of unemployment data in the United States. At the moment of publication of the report the price gap of more than 10 points has occurred on the EURUSD market.

Client claims that the broker has violated the procedure for opening pending orders caught in the price gap, what in turn led to a deficit of margin and the subsequent liquidation of his positions by Stop Out. Client believes that pending order # 146331265 should have been executed first, instead of pending order #146330490 and explains that in case of the right sequence of execution of orders the order # 146330490 would have been cancelled due to lack of funds.

Client considers broker’s actions as misconduct and demands compensation (at least the lost deposit should be restored).

Complainant Broker
XXX YYY
Financial Commission Complaint #ZZZ
Complaint Raising Date Complaint Filing Date
11/17/2015 12/04/2015
Complaint Response

The decision for this complaint is based on the information provided by Mr. XXX and Broker YYY.First of all, it should be noted, that above mentioned reaction of the market on publication of important macroeconomic data in the US is not rare and often lead to the increase in volatility,  short-term decrease in liquidity and, consequently, to price gaps and increased spread size in the instrument.

Secondly, it should be also mentioned, that Buy Stop/Sell Stop type orders by their nature do not guarantee the execution at exact price specified in them. Depending on market situation such orders can be executed either at exactly specified price or at a price that is worse than indicated in the order. Buy Stop/Sell Stop type pending order become active as soon as at least one quote in the broker’s price feed reaches the price that is specified by the client. After activation of pending order it must be executed at the first available quote in the broker’s price feed. In this particular case, client’s orders #146331265 and #146330490 got in a price gap and were activated at broker’s server simultaneously. This fact was confirmed by the server’s log-file records provided by the broker.

Thirdly, the broker does not regulate the procedure for execution of orders in the price gap. For comparison, on real Inter-Bank market in the situation similar to abovementioned it is more likely that the larger volume order would be executed first as it corresponds with the logic of market. The technology of execution of orders/transactions is structured in a way where orders/transactions of a larger volume are executed first and only afterwards the smaller volume orders/transactions could be executed at prices that remained.

Such practice of execution of pending orders does not contradict the official response of the Broker YYY received by the Client.

Based on the above information the Dispute Resolution Committee does not find any violations from broker’s side, consequently there are no grounds for the Client’s complaint.

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 Anatoly Bulanov.

Ruled in Favor Compensation
Broker None
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.
Signature Designation Date

Head of DRC

12/04/2015

 

Customer Complaint Dated January 22, 2015

Complaint Matter

Mr. XXX claims on January 15th he was stopped out of his two positions in EURCHF at prices that were inconsistent with the market. Following the SNB announcement there was extreme volatility in the swiss franc which appreciated substantially against the Euro and other currencies. Despite the sharp drop in EURCHF Mr XXX’s 2 short positions or 0.01 lots in the pair were stopped out by a ‘non market spike’ to the upside with quotes as high as 1.33 following the announcement from a level of around 1.20. Mr XXX mentions that not only was he stopped out at prices that he mentions were totally inconsistent with the market but he missed the opportunity to benefit from the large subsequent drop in prices. He contacted the broker whom initially responded and refused his proposal to be closed by actual market prices at the time which he claims were closer to 0.85 at the time. When asked by the Commission if he received any compensation from the company Mr XXX confirmed he received his ‘deposit’ back from the company.
Mr XXX is claiming his two positions be closed out at 0.85 and the reopening of his two pamm accounts (which were closed) enabling him to trade or withdraw funds.
Mr XXX provided his pamm accounts position statements and chart information.

Complainant Broker
XXX YYY
Financial Commission Complaint #ZZZ
Complaint Raising Date Complaint Filing Date
1/15/2015 1/22/2015
Complaint Response

The company’s response confirms the extreme volatility that was created at the time by the SNB announcement. They mention at the time their specialists detected a ‘spike’ topping 1.3269 on two servers which was confirmed as to price and volume by their liquidity provider. The company asserts their hedge trades were not corrected or cancelled despite their attempts to do so. Nevertheless the company proceeded to correct the MT4 charts and decided to compensate its clients the losses caused by these prices. Mr XXX‘s accounts were indemnified with Usd 85.12 and Eur 61.13. He was duly notified.

The decision for this complaint is based on the information provided by Mr XXX and Broker. Summarising all the above the Dispute Resolution Committee found in favour of Mr XXX. The committee found that the upward ‘spike’ following the announcement by the SNB was not consistent with acceptable market prices and noted the steps the company took to indemnify the client. The Committee also found that the client should receive a form of fair compensation further than that already provided to reflect his missed opportunity. The Committee recognised the technical issue the company may have had in its decision for the company to award further compensation to the client. However, the Committee does not believe that the company must be responsible for all hypothetical income that the client could possibly make based on historical data.

Ruled in Favor Compensation
Client Broker member decision
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.
Signature Designation Date

Head of DRC

02/24/2015

 

Customer Complaint Dated November 28, 2014

Complaint Matter 

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

The client claims his positions in USDRUB were closed out (stopped out) at a price that was’ non-market’ on November 28th. The client notes that the spread expansion was asymmetrical and affecting the offered side of the market adversely impacting his short positions. Also that other ‘non market quotes’ provided by the brokerage were filtered out with the exception of the one that caused his positions to be stopped out. The client is claiming USD1,434.81 as compensation for the loss.

Complainant Broker
XXX XXX
Financial Commission Complaint #XXX
Complaint Raising Date Complaint Filing Date
11/28/2014 12/18/2014
Complaint Response

The company provided tick data for the said date when the client positions were stopped out maintaining that due to increased volatility spread increases for USDRUB occurred on several occasions that day. The company states that under normal conditions spreads are stable but the ‘dramatic’ increase in volatility caused spreads to widen from their liquidity providers which was reflected in their pricing. The company also offered the client a different choice of account with different conditions and fixed spreads.

Decision on this complaint is based on the information provided by Company and by the Client.

Summarizing all above the Dispute Resolution Committee found in favour of the client as the stop out price achieved on the day was not consistent with market prices overall despite the increased volatility.

This complaint was considered by members of the Dispute Resolution Committee  and framed by the Head of the Committee.

Ruling in favor Compensation
Client $1,434.81
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.
Signature Designation Date

Head of DRC

01/05/2015

 

Customer Complaint Dated November 12, 2013

COMPLAINT DETAILS

After opening his trading account #XXXXX on February 14, 2013 the complainant made several funding operations using a variety of payment methods. The total amount of funds deposited by client on his trading account had reached $32143.25. On September 5, 2013 the client made a trial withdrawal of funds in the amount of $170. On November 8, 2013 the client filed his first request for withdrawal of funds in the amount of $3000. On November 11, 2013 the client filed his second request for withdrawal of funds in the amount of another $3000. The client confirms that all his withdrawal requests were sent to the broker`s back-office and his personal manager. 

The dispute situation occurred on November 12, 2013. On that day the broker has blocked the client`s trading account and closed his positions with a total loss of $25980. In justification of his actions, the broker cites the fact that the client initiated a chargeback against his funding operation dated July 8, 2013. The Broker claims that his payment counterparty notified him about the chargeback operation related to funding transaction #ZZZZZ dated July 8,2013 for the amount of $3000. The chargeback operation ARN was provided as well. The chargeback was executed on November 8,2013. 

On November 22, 2013 the client received the wire transfer in the amount of $3000 from the broker. For the period of next three months the client was trying to deal with the broker and resolve the dispute. The client insists that he did not initiate chargeback operation and provides investigation with his bank notice as confirmation. On February 25, 2013 the client withdrew remaining funds in the amount of $ 15780.15 from his trading account.

DRC DECISION

Financial Commission Complaint Response
Name of the Applicant Broker – Company
CLIENT BROKER
Complaint to Financial Commission # ХХ
Date of complaint Date of complaint submission
11/12/2013 03/14/2014
Complaint Matter

CLEINT submitted a complaint to the Financial Commission regarding the following:

Trading account number XXXXX. Starting from February 2013, the client conducted active trading activity in his account. The client used several different funding methods, including plastic cards of several banks. The total amount of the funds invested by client had reached $ 32143.25. On November 12, 2013 the broker had blocked the client`s trading account and closed his positions with a total loss of $25980. According to the broker, the reason for blocking customer’s account was  a chargeback operation, initiated by the client.

The client claims that the broker brings against him baseless accusations because he had never initiated chargeback operations. The client believes that the broker unreasonably blocked his trading account, and thus made a significant material and moral damage to him. The client requires compensation from the broker in the form of refund of the remaining part of invested funds ($ 13193.10).

Complaint Response

Decision on the complaint was made on the basis of information provided by the BROKER and the CLIENT.First of all, it should be noted that in accordance with the rules of the Financial Commission “Customer may submit a claim to the Financial Commission within 45 days of the incident.” Such restrictions are not accidental, because, in our opinion, prolonged inactivity of the parties only exacerbates the situation and complicates its fair settlement.

Second, the both parties of the dispute have enough solid evidence that there were no violations of regulations and rules of engagement for business partners. Here we are referring to the fact that:

a) the customer has provided sufficient documentary evidence of the absence of any intention to initiate a chargeback operation and thus cause material damage to his partner (broker);

b) on the other hand, we are convinced that the brokerage company also acted within the rules (para. XX and ZZ of the Customer Agreement) and blocked legitimately the trading account of the customer to learn more about the chargeback operation.

After verification of the information provided by the parties of the dispute, members of the DRC came to the unanimous opinion that this claim cannot be the subject of investigation by the Financial Commission according to para.11 (e) of the Rules of the Financial Commission.

DRC members believe that in this situation all the responsibility lies on the BROKER`s financial counterparty (CONTRACTOR), which in accordance with its security policy for any reasons beyond the control of the BROKER initiated chargeback operation.

Thus, formally speaking, this claim cannot be resolved in one’s favor. However, the general opinion of the members of the DRC, as an act of goodwill BROKER could meet some of CLIENT`s requirements for compensation of material damage. It is out of question to fully compensate the customer`s material damage, because at the moment of the incident the customer’s account was at a loss. Furthermore, because of limitation period of the incident we also cannot consider any recovery of the client`s positions.

This complaint was reviewed by the members of the Dispute Resolution Committee and was processed by the head of Committee Anatoly Bulanov.

Decision in favor of Compensation
Client At Broker’s discretion
If you have any questions regarding this complaint review, please send them to info@financialcommission.org
Confirmation
I certify that the Dispute Resolution Committee considered all information and I confirm that the decision was made fairly, impartially and without anyone’s intervention. I am sure that the information provided in the document is true.
Signature Position Date
Head of Dispute Resolution Committee 03/31/2014

 

Customer Complaint Dated February 4, 2014

COMPLAINT DETAILS

The client led simultaneous trading on three micro accounts: #XXXXX, #YYYYY and #ZZZZZ.

On each of these accounts were opened several short positions in GBPUSD. In accordance with the terms of trade established by the broker for micro accounts a client can choose the leverage from 1:1 to 500:1, but the account balance should not exceed the amount of $3000. Furthermore, in case of the account balance exceeds $3000, the leverage is being automatically reduced by 100 times.

The dispute occurred on February 14,2014 after the emergence of the free margin deficit caused by an adverse movement in price of GBPUSD. The client decided to add some money to the account in order to prevent positions liquidation (Stop Out), hoping for a favorable price movement in the near future. The client informed the broker (online support representative) about the fact and asked him to keep his account leverage ratio unchanged (500:1) because after adding money to his account the balance exceeded the limit of $3000. In response to the customer`s request the broker recommended him to reduce the balance by withdrawing a part of funds from his account. The client submitted a request to withdraw the funds but ultimately, his losing positions were closed on stop out. 

The customer is not satisfied with the brokerage company actions, because he believes that misleading terms of trade established by the broker for micro account led to his losses. 

DRC DECISION

Financial Commission Complaint Response
Complainant       Broker
CLIENT BROKER
Financial Commission Complaint #XX
Complaint Raising Date Complaint Filing Date
2/4/2014 3/1/2014
Complaint Matter

CLIENT has lodged his complaint with Financial Commission because of the following:

Simultaneous trading was conducted by the client on three micro accounts: #XXXXX, #YYYYY and #ZZZZZ. 

Several short positions in GBPUSD were opened on each account with different time intervals. Later on, due to margin deficit caused by an adverse movement in exchange rate of GBPUSD all losing positions were liquidated by the broker (Stop Out operation).

The client is not satisfied with the broker actions, and believes that “misleading terms of trade” established for micro account were the main reason of his losses. According to the client, he had no choice to save his account under such trading rules. In connection with the above, the client believes that a fair resolution of his complaint would be to require the broker to compensate his losses (about $ 7500) caused by the forced liquidation of his positions on three accounts.

Complaint Response 

Decision on this complaint is based on the information provided by BROKER and CLIENT.

In accordance with the terms of trade established by the broker for micro accounts, any client can choose the leverage from 1:1 to 500:1, but the account balance should not exceed the amount of $3000. Furthermore, in case of the account balance exceeds $3000, the maximum leverage is reduced automatically 100x (leverage ratio can vary from 1:1 to 5:1). The Stop Out level is also clearly stated on the broker`s web site (20%). The company shows all trading terms in “Terms of Trade” section on its website. Also, trading terms are communicated to the client upon account registration. By accepting these trading terms the client confirms his understanding of the margin requirements and changes in margin requirements based on trading account balance as well.

Summarizing all above, it is obvious that the broker has provided the customer with acceptable conditions for trading, despite the fact that these conditions were not the best in terms of the customer. Thus, the DRC sees no violations of the trading terms and does not find any ground for raising claims against the broker.

This complaint was considered by the members of the Dispute Resolution Committee of the Financial Commission  and framed by the head of the committee Anatoly Bulanov.

Ruling in favor Compensation
BROKER None
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.
Signature Designation Date

Head of DRC

03/13/2014

 

Customer Complaint Dated July 30, 2013

COMPLAINT DETAILS

Based on the investigation of the claim materials provided by the parties of the dispute on December 31, 2013 the DRC had found out that the complainant had some trading issues with the broker company in July 2013. According to the client, the matter of claim worth about $200’000 since he had his own PAMM account with the broker and conducted about 2000 deals in a month. He claims that there were regular delays during execution of his pending orders. Furthermore, those orders were executed at the worst quote in the tick history within 6 seconds every time after market had hit the price level stated in the order. Client also claims that all those orders were pending orders sent hours before they were executed. This was regardless the market condition and the volume of orders. Accodring to the client the slippage wasn’t applied only when there was no quote in the tick history worse than 10 pips (0.00001) compared to the order price (which is the minimal slippage for Standard account).

DRC DECISION

Financial Commission Complaint Response
Name of the Applicant Broker – Company
CLIENT BROKER
Complaint to Financial Commission # ХХ
Date of complaint Date of complaint submission
7/30/2013 12/30/2013
Complaint Matter

CLEINT submitted a complaint to the Financial Commission regarding the following:Trading account number XXXXX.

During the period of the active trading on the investment account from 1 to 30 July 2013 (made about 2000 trades during this month) BROKER systematically executed client’s pending Stop orders with several-seconds delay and a few-pips slippage, thus limiting the potential profit of the client. According to calculations by the client, this resulted in the lost profit in the amount of $ 200,000.

Customer demands compensation of the lost profit by recalculating execution prices and reimbursing the difference.

Complaint Response

Decision on the complaint was made on the basis of information provided by the BROKER and the CLIENT.First of all, it should be noted that the Buy Stop and Sell Stop orders by their nature do not guarantee the execution of the client’s orders at the exact specified price. Depending on market conditions, such orders can be executed either at the exact specified price or at a worse price. Pending Buy Stop (Sell Stop) order becomes active as soon as at least one quote in the stream of the broker’s price broadcast reaches the value specified by the client. After activation, the pending order is executed at the first available quote in the stream of broker’s price broadcast. Under high market volatility, the execution price of the pending order may differ by a few pips from the price specified by the client.

This pending order execution practice is not contrary to the official response of BROKER, received by the client in response to his complaint. According to the trading policy of BROKER, “all pending orders and orders «IF-Done» are executed by the Company at the stated price or at the price available at the time of order execution, while the execution price may differ from the price specified in the order” (para. XX.XX Trading Policy).

The client complaint refers to a fairly large amount of trades done over a relatively long period of time. It can be assumed that market conditions could not always be the reason why the broker executed the pending orders with delay and slippage. However, it can be seen from the client’s trading log that most of the client’s orders were executed in periods of high market activity (the height of European or American trading sessions), and usually shortly before, or during, or immediately after the publication of important economic news. Typically, these events are accompanied by increased market volatility, which inevitably leads to the increase in the spread and the slippage.

In our view, it is incorrect to argue that low-quality execution of pending orders resulted from broker’s evil intent – since no item of the Trading Policy was violated.

In summary, we can assert that the broker provided acceptable conditions for the client’s trading, despite the fact that these conditions were not the best from the client’s point of view. Thus, the Dispute Resolution Committee sees no violations in the broker’s actions and sees no grounds for the client’s complaint.

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

Decision in favor of Compensation
BROKER No
If you have any questions regarding this complaint review, please send them to info@financialcommission.org
Confirmation
I certify that the Dispute Resolution Committee considered all information and I confirm that the decision was made fairly, impartially and without anyone’s intervention. I am sure that the information provided in the document is true.
Signature Position Date
Head of Dispute Resolution Committee

01/30/2014

 

Customer Complaint Dated February 28, 2014

COMPLAINT DETAILS

The complainant conducted trading operations on his account #XXXXX. The dispute situation occurred on Feb 28, 2014.

On that day a short position was opened by EA on the instrument USDJPY:

2014.02.28 00:00:56 ‘XXXXX’: order #ZZZZZ, sell 0.33 USDJPY at 102.23200

Immediately after position opening the EA had set a pair of OCO orders (Stop Loss and Take Profit):

00:00:57.353 ‘XXXXX’: order #ZZZZZ sell 0.33 USDJPY at 102.232 was modified -> sl: 102.422 tp: 102.162

A few minutes later the EA changed the parameters of OCO orders (Stop Loss and Take Profit):

00:05:50.151 ‘XXXXX’: order #ZZZZZ sell 0.33 USDJPY at 102.232 was modified -> sl: 102.192 tp: 102.162

Finally, the client`s position # ZZZZZ was closed after market price had reached Take Profit level. This fact was confirmed by the log file of the broker`s server:

2014.02.28 00:11:29    ‘XXXXX’ order #ZZZZZ take profit 0.33 ‘USDJPY’ closed at 102.16200

2014.02.28 00:11:29    ‘XXXXX’: order #ZZZZZ sell 0.33 ‘USDJPY’ closed at 102.15700

The dispute between two parties aroused because subsequently the broker completely annulled the deal on the instrument USDJPY, justifying his actions by the fact that at the time of client`s order execution (02/28/14 00:00, MT4 platform time) there was a “non-market spike”  on the instrument USDJPY which was registered on the ECN server. As a result, the prices had been recognized as non-market by liquidity provider, and position # ZZZZZ was canceled, which is confirmed by the server log file:

2014.02.28 02:09:12 order #ZZZZZ for ‘XXXXX’ deleted – sell 0.33 USDJPY at 102.23200, profit: 24.23

The complainant believes that the broker distorts price feed and utilizes price manipulation practices. According to the client a fair resolution of the dispute would be to require the broker to compensate his unrealized profit which was cancelled due to annulled deal. Also, he insists on public recognition of the fact that price distortions on the ECN server resulted from broker`s manipulation.

DRC DECISION

Financial Commission Complaint Response
Name of the Applicant Broker – Company
CLIENT BROKER
Complaint to Financial Commission # ХХ
Date of complaint Date of complaint submission
28/2/2014 31/3/2014
Complaint Matter

CLEINT submitted a complaint to the Financial Commission regarding the following:

Trading account number XXXXX.

Short position on USD/JPY, opened with the help of the expert advisor and subsequently closed after reaching Take-Profit order, was completely annulled by broker:

Ticket ZZZZZ sell 0.33 USDJPY @ 102.23200 sl: 102.192 tp: 102.162

Client demands compensation for lost profit because he believes that the cancellation of the position was ungrounded.

Complaint Response

Decision on the complaint was made on the basis of information provided by the BROKER and the CLIENT.After analyzing the information, members of the Dispute Resolution Committee came to the conclusion that the broker had no grounds for cancelling the client’s trading action, which led to the opening of the short position, as it was the result of the natural price movement. Before the occurrence of the disputed price spike customer had already set the orders to close the position:
Buy Stop@102.192 and Buy Limit@102.162.

Thus, the client’s position had to be closed after the first price movement following the price spike and which reached one of the client’s pending orders. In any case, the result of the short position should be the profit credited to the customer’s account. Broker must justify closing a position (on the Buy-Stop or Buy-Limit order) by providing Time & Sales information to the client.

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

Decision in favor of Compensation
CLIENT $24.23
If you have any questions regarding this complaint review, please send them to info@financialcommission.org
Confirmation
I certify that the Dispute Resolution Committee considered all information and I confirm that the decision was made fairly, impartially and without anyone’s intervention. I am sure that the information provided in the document is true.
Signature Position Date
Head of Dispute Resolution Committee 10/4/2014

 

Customer Complaint Dated December 13, 2013

COMPLAINT DETAILS

During the investigation of claim materials provided by the client on December 30th , 2013 the DRC found out that during the period of three months (from late August until the end of December 2013), the client made her trades using trading adviser (EA) specifically designed for MT4 platform and managed to earn some profit on her  trading account . On November 5th, 2013 the client withdrew a portion of the profits ($400) from her account and continued to trade. After some time, the broker found a violation of trading rules on the client`s side and made a decision on December 24th, 2013 to cancel all accumulated profits the client  had made by that time. In their arguments broker refers to the fact that during the period from November 5th  to December 4th , 2013 the expert adviser, used by the client, was able to identify financial instruments with quotations, lagging behind the real market, thus allowing  the client to conduct transactions on obsolete or non-existent prices. In addition to canceling most of client`s profitable trades results the broker company requires the client to close her live account. In turn, the client does not find any violations of trade rules in her actions and demands compensation for wrongfully canceled profit of 586.16USD.

DRC DECISION

Financial Commission Complaint Response
Name of the Applicant Broker – Company
CLIENT BROKER
Complaint to Financial Commission # ХХ
Date of complaint Date of complaint submission
12/13/2013 12/30/2013
Complaint Matter

CLEINT submitted a complaint to the Financial Commission regarding the following:
Trading account number XXXXX.Client does not agree with the decision of the brokerage company to annul the results of the trading in the period from November 5 to December 4, 2013 and to withdraw $ 586.18 from her trading account, and therefore demands that the account balance is restored to its previous level. 

Complaint Response

Decision on the complaint was made on the basis of information provided by the BROKER and the CLIENT.After thoroughly analyzing the information provided by dispute parties, the Dispute Resolution Committee came to the conclusion that the client employed an expert advisor (EA) which exploited vulnerabilities in broker quotation system. Such actions are unacceptable for honest and mutually beneficial relationships between business partners.According to the trading policy of the BROKER, in such cases the company has every right to cancel a client’s orders and to annul the trading result of the incorrectly executed trades.In addition, it is also worth noting that while using such practices, the client was able to withdraw from her trading account $ 400 of the dishonestly earned profit.

Based on the above information, the Dispute Resolution Committee sees no violations in the broker’s actions and believes its actions are lawful.

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

Decision in favor of Compensation
BROKER No
If you have any questions regarding this complaint review, please send them to info@financialcommission.org
Confirmation
I certify that the Dispute Resolution Committee considered all information and I confirm that the decision was made fairly, impartially and without anyone’s intervention. I am sure that the information provided in the document is true.
Signature Position Date
Head of Dispute Resolution Committee 01/20/2014