FXDD Class action lawsuit

neil

Legendary member
5,167 745
seems it's safer and more prudent to trade currency Futures with a standard broker>
 

wackypete2

Legendary member
10,200 2,044
I see FXDD are the latest retail forex broker to be taken to court. The paperwork makes for interesting reading, all the usual stuff about slippage, fake price spikes, altering margin requirements.

http://demod19.webzonedemo.com/forex/wp-content/uploads/2011/02/Hugo-Cruz-v.-FXDD-Executed-Complaint-2-10-11-doc-68.pdf

I've used FXDD since 2006 and still use them today.

I won't say that FXDD is above any of the accusations. The entire industry is shady so it's reasonable to assume FXDD employed it's share of unfair practices. Indeed, from my own experiences some of the accusations appear to have merit but difficult to prove.

A few things I noted about the lawsuit after reading it through:
- 55 pages and no where does it offer any proof of what happened. Only accusations.

- Most of the accusations stem from the fact that demo accounts do not operate the same as live accounts. This is repeated many times.

- FXDD has several platforms. The lawsuit does't say which platform(s) it applies to or even whether or not it applies to all of them.

- What may be most damaging to FXDD is the accusation that they do not operate as advertised or as stated in their Terms of Service.

From my OWN experiences with FXDD:
- I had 2 instances where I thought there was a serious enough issue to warrant a call to customer service and complain, in a professional manner, of course. Both times the issues was resolved quickly and to my satisfaction.

- In January of this year FXDD switched to 5 digit pricing. Traders with accounts opened prior to that were offered a chance to continue with 4 digit pricing if they opted-in. I took that offer and continued with 4 digit pricing. Spreads widened so much that I almost closed my account. Apparently, enough people complained and this was resolved.

- From page 8: "... dishonest trade execution practices are designed to cause a customer to lose money no matter how skillful the customer may be in executing trades." This is the only statement in 55 pages that I will refute. If you know what you are doing you CAN make money. For nearly a year and a half I have posted trades and have overall profited from them in the FX live calls thread here on t2w.

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The difference in my time with FXDD may result from my being an experienced trader, not crying over a lost pip or 2, and having an above average sized account which is why customer service may have reacted so promptly.

Peter
 

wackypete2

Legendary member
10,200 2,044
seems it's safer and more prudent to trade currency Futures with a standard broker>
I have never traded currency futures so I can't compare the 2, but I am leaning towards trying it and see if it's better. My guess would be there's not much difference. Manipulation goes on in any market you trade. It just happens differently and by different participants.

Peter
 

pboyles

Legendary member
8,072 1,301
Yes theres little in the way of evidence in that particular document and I imagine they've thrown a lot of allegations around hoping some will stick. Still the absence of evidence in that particular document doesn't mean it doesn't exist elsewhere. I suppose we'll all find out when it gets settled or ends up in court.
 

alan5616

Established member
669 45
Yes theres little in the way of evidence in that particular document and I imagine they've thrown a lot of allegations around hoping some will stick. Still the absence of evidence in that particular document doesn't mean it doesn't exist elsewhere. I suppose we'll all find out when it gets settled or ends up in court.
This seems to be following a similar pattern to the case, brought by the NFA, against FXCM. There were rumours and accusations, prior to formal action being taken.
 

pboyles

Legendary member
8,072 1,301
There's always people complaining about slippage, stop hunting and platform freezes. Previously they were shouted down and told not to blame the broker when they lost money. More recently we've seen they were actually right all along. Time will tell if this case has any merit but yes it does all sound very familiar considering the FXCM judgment.
 

tar

Legendary member
10,441 1,313
There's always people complaining about slippage, stop hunting and platform freezes. Previously they were shouted down and told not to blame the broker when they lost money. More recently we've seen they were actually right all along. Time will tell if this case has any merit but yes it does all sound very familiar considering the FXCM judgment.
I don't understand from where you get that are you talking about Gain ? fxcm wasn't charged for stop hunting or "platform freezes" , only for unpaid positive slippage , they even weren't charged for unfair negative slippage practices ...
 

pboyles

Legendary member
8,072 1,301
Virtual dealer plugin is designed to delay orders for up to 5 seconds, FXCM were fined for using asymmetrical slippage settings ie keep the positive slippage, pass on the negative. I'm sure theres a reasonable excuse for it all though.
 

tar

Legendary member
10,441 1,313
seems it's safer and more prudent to trade currency Futures with a standard broker>
BTW it is not so great , i do prefer exchange trading but not always , check Pound futures chart after BOE decision at Thursday , the low is 1.5180 instead of 1.5270 talk about major slippage and stop hunting !
 

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