There are certainly strange things happening with this whole situation. I have a 6 figure account with FXLQ and have been with them for about a year and a half, very happy with them until now, by the way. On Tuesday evening I started my "work day" during the Asian market and tried to put a pending order, to my surprise it would not take it, so after repeated attempts I called the trading desk and they gave me the news on the whole situation. As it was explained by them, it seemed like something that would be resolved in a day or two.
Nevertheless, I filled out a request to withdraw my funds and then went to the NFA link to read the whole case, which clearly portrays a picture of FXLQ making up capital assets with an inexistant Bond from ABN ARMO BANK (one of EU's biggest banks).
Now, I was worried, so I decided to take the next plane to LAX at 8:00AM EST (I live in South Florida). I was in their office by 12:30 PM PST and everyone seemed to be working normally along with two auditors from NFA. After speaking to one person and another and waiting for several hours I was told that they had been denied permission by Jenifer Sunu, from NFA in Chicago to disburse any of my funds. Unfortunately, it was too late to call her in Chicago so I had to wait until the next. . During this time, several of the company executives met with me, including Robert Gray, and they explained how they have funds in different financial institutions in Europe and that the NFA did not want to accept this and ordered them to repatriate all these funds, which they were in the process of doing, but this was not an overnight ordeal. Robert Gray said that this order to repatriate funds had come in on Monday and the Member Responsibility Action, came in the next day (Tuesday).
The following morning I started calling Jenifer Sunu and finally, after about 4 hours of failed attempts, she finally picked up the phone. After listening to everything she had to say, I practically lost all hope of getting my money back, or at least the whole thing. The first thing I asked her was, why she had not authorized FXLQ from giving me my money back and she responded that the audit shows that there is ten million dollars deficiency. In other words, (her words) she said that my position was that of any creditor and had the same importance, legally, as the phone bill, and therefore, if there is a shortfall of 10 million dollars, the creditors would receive their funds in the proportional amount of what is "left". She gave me an example of when a "bankrupt" company dissolves. She even said that this was a done deal on their part. That it was out of their hands and that the CFTC had been notified for them to name a liquidator and dissolve the company and pay creditors with whatever funds are left and they (CFTC) would be in charge of any charges or legal actions against the principals and/or executives..... In short, not much hope.
As soon as I hung up with her, I took off to FXLQ and met with Robert Gray and told him my conversation with Ms. Sunu. He was outraged and immediately called his lawyer into his office and they called Ms. Sunu. While the attorney was trying to reach her, Robert showed me how they had already received two wires from Europe, one for over two million and the other one for a million something.
A few minutes later, the attorney came back to Robert Gray's office and said that Jenifer Sunu, was denying everything (several other customers had also called with similar stories, some where told that they would be lucky to get 50 cents on the dollar). So they asked me, if I wanted to talk to her, which of course I did. We put her on speaker phone and she started by saying that I had misunderstood her, she acknowledged that FXLQ had already received 2 multimillion dollar wires from their offshore accounts and that in no way was this a done deal on the part of the NFA, completely contradicting herself from my earlier conversation.
This, in a way, gave me renewed expectations but at the same time it is really strange that the NFA would bad mouth the company to the extent of practically giving me a verbal "death certificate" and then when confronted with the "patient" takes everything said back. Why?
As far as my perception, to me FXLQ has always showed honesty and integrity, at least compared to a big list of other FXBrokers I have had accounts with. I had many experiences where they honored and fixed, to my benefit errors created by MT4. As far as my face to face meetings with them last Wednesday and Thursday, I get the feeling that they are truly trying to survive this ordeal and the proof is in the millions that they repatriated on Thursday, which shows that instead of folding they ARE actually bringing money in. They think, that ounce they come out of this NFA persecution, they will prove to be stronger than before, which is obviously true, BUT the question is, if they are able to prove that their financial solvency is adequate and in line with what was previously reported, will they be able to continue business as usual or will the damage caused by this whole ordeal be too deep to recover?
I'd like to also mention that I asked Ms. Sunu in my first conversation, what good is their monthly FCM Financial Data Report, if the information in it is not reliable; She answered that all companies are audited every year, but it seems that documents that were accepted last year, are now questionable. So what good is basing your decisions on choosing a broker on this report if its validity is questionable.
In general, I prefer to have the NFA than nothing at all, as most
other countries, but it definitely needs a lot of work to be an real
and effective controlling organization.
UPDATE: I just got a call from one of the executives that told me that they received another four million (I did not ask if they received anything on Friday) and they had been trying to get the NFA to authorize the release of customer funds but had no positive response yet and they expected to get the authorization, hopefully, by tomorrow.
Regards,
CMA
