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Development of Global Ethical Standards for Brokers

Too bad most bad brokers are owned by companies which are owned by other companies which are owned by other companies. Although corporate details at all levels should be disclosed, being "owned by a company" should be no excuse for not disclosing the people behind the curtain.

There are also the "multi-brokers" to be addressed. Some are legitimately registered as separate entities in separate jurisdictions (for example, more than one US based broker also has a .uk branch as a separate company regulated by the UK FCA). The issue is that there are unethical brokers which let clients register on a website proudly displaying UK or Cyprus registration, and then dump the clients into a totally unregulated "separate company" registered on an island somewhere.
 
Yes, it is really bad! The worst part is that we usually approach brokers according to the information they publish. "Multi-brokers" are hard for identification by the regular customer.

However, the experience shows that there are few important things to check:

1. Physical address shall be written and it shall be the same as published on the relevant regulator.
2. Reading all of the terms and conditions - so called "multi-brokers" could have some hard to interpret conditions, though which they just misinform the client.
3. Some brokers have "brands" under which they trade on different territories - which is regulatory body and how they are regulated.
4. Does the broker use an aggressive marketing strategy - did someone pursues you to open a real account by calling you every few days, do they offer a lot of bonuses etc., do they tell you over the phone how "easy" is making money with them, and how their research team will "help" you to trade profitably at last - those are warning signals instead "added value" services.

Having written the above, we all should go beyond the usual "how to choose broker" list, but become very investigative before opening an account and trading. Brokers

As a whole, I come to to conclusion that brokers offering spot Forex only are very risky for the clients. We shall think about trading FX futures and options on FX with American or European exercise style. Such are traded on regulated exchanges. While they carry risks as products, the brokers offering them are rigorously regulated.
 
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