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Abstract:The United states Commodity Futures Trading Commission has secured an order of permanent injunction order against an unregistered broker - JAFX.
The Utah District Court has signed an order of permanent injunction and other statutory against JAFX, Ltd. JAFX claimed to be operating from St.Vincents and the Grenadines, as well as Bulgaria. They were not registered with the CFTC and claimed not to accept clients from the United States. The retail Forex broker started operations in at least September 2015, using the domain www.JAFX.com and offered to be the counterparty to leveraged, retail Forex transactions for clients located in the United States who are not Eligible Contracts participants. All these done while the company was not registered with the CFTC as a retain Forex dealer and didn't provide full risk disclosure statements.
It was noted that though the website claimed not to direct their solicitations to U.S customers, there are not proofs in the account opening processes that the firm does not accept applications form U.S residents. In the account opening form, U.S was the first country listed in the drop down menu of accepted countries. It further shows that U.S customers can open an account with this broker with just $100.
JAFX didn't advice actual and prospective U.S customers that the company has not registered and is suppose to be registered with CFTC as a retail foreign exchange dealer. It neither didn't disclose to customers that it's unlawful to operate as a Forex dealer in the U.S without the necessary accreditation.
JAFX failed to provide customers with a written risk disclosure statement each time an account was opened.
Throughout the account opening process, JAFX never sought any information about prospective customer's ability to send or receive actual delivery of Forex products neither did it bother to know customer's business need for Forex.
In summary, the Commission accused the company of operating as an unregistered foreign exchange dealer, and failing to provide customers with the required risk disclosure statements. Armed with all these allegations, the CFTC back in July 2018, accused JAFX for violations of the Commodity Exchange Act and the Commission's Regulations. The Commission therefore sought injunction as well as imposition of civil penalties. It appears that JAFX would face the required penalties as the order was signed by Judge Jill N. Parrish of the Utah District Court.
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In this article, we will analyze the characteristics of this broker from various aspects, providing you with simple and organized information.
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The foreign exchange market, commonly known as forex, stands as the world's largest financial arena, boasting daily trading volumes in the trillions of dollars. For those eager to capitalize on currency fluctuations, entering this dynamic yet intricate market necessitates the guidance of a skilled intermediary: the forex broker.