On 24 July 2014, I traded on AUDUSD and I ended up in large profit. Subsequently, GDMFX cancelled the trades, invoking the off-market prices provision. In particular, they said:
“This email is a notification for order execution details.
Due to using an arbitrage expert adviser in your trading account # 8126263 all your trades which were opened at 01:45:00 on 24.07.2014 have been adjusted to the real market price - 0.9462.
Your EA had opened all these trades on a non-market price at 0.9442 which actually is the quote at 01:44:59 according to our tick history.“
I told GDMFX that I obtained a Bloomberg quotation which shows that the requested price that they entered and confirmed in the account statement and trading platform (0,9442) was available at the time I placed the buy order - 01:45:00. Therefore, their justification of incorrect prices was groundless and they should return the profits.
They replied the following:
“Under the normal GDMFX practice it will be possible to re-investigate your case with respect to the claims you have made in your last message dated 29th of July 2014.
Please, provide us with any evidence in support of your arguments in defense of your EA within the next one week!
Regarding the Bloomberg Quotes you mentioned, please note, no Broker will take responsibility for a quote shown somewhere else by someone else. Additionally, the Foreign Exchange Market is not a centralized market, therefore it is normal to observe differences between the Quotes offered by two separate providers at the same point in time.“
I told them the burden of proof regarding anything wrong with the Expert Adviser lied with them. In addition, I said:
“Although it is indeed possible to observe differences between the quotes offered by two separate providers at the same point of time, these need to be reflective of the real market price. Otherwise, a broker could adjust its prices as much as it sees fit to the detriment of the customer. The aforementioned construction is valid all over the world and my evidence shows that your quote was in perfect accord with the market rates. It follows that you were not authorised to adjust the price and I am entitled to all my profits and deposit.“
Later, they reiterated their previous arguments, stressing the particular provision in the contract and that was it. I was later told that a deadlock has been reached and that I could lodge a complaint to the Financial Dispute Resolution service.
GDMFX failed to produce any convincing evidence that the price was wrong. They merely stated that the real market price at 1:45:00 was 9,462. The attached Bloomberg shows that the price of 9,462 appeared in the market, however it is the - worst and - latest one. So, on the one hand GDMFX quotes the price of 9,462 at 1:45:00 which is in complete accord with the Bloomberg, but on the other it states that it does not reflect Bloomberg when saying that the original price of 9,442 was not present at 1:45:00.
Therefore, I believe that GDMFX was not authorized to cancel my trades because the originally quoted price was reflective of the market.
“This email is a notification for order execution details.
Due to using an arbitrage expert adviser in your trading account # 8126263 all your trades which were opened at 01:45:00 on 24.07.2014 have been adjusted to the real market price - 0.9462.
Your EA had opened all these trades on a non-market price at 0.9442 which actually is the quote at 01:44:59 according to our tick history.“
I told GDMFX that I obtained a Bloomberg quotation which shows that the requested price that they entered and confirmed in the account statement and trading platform (0,9442) was available at the time I placed the buy order - 01:45:00. Therefore, their justification of incorrect prices was groundless and they should return the profits.
They replied the following:
“Under the normal GDMFX practice it will be possible to re-investigate your case with respect to the claims you have made in your last message dated 29th of July 2014.
Please, provide us with any evidence in support of your arguments in defense of your EA within the next one week!
Regarding the Bloomberg Quotes you mentioned, please note, no Broker will take responsibility for a quote shown somewhere else by someone else. Additionally, the Foreign Exchange Market is not a centralized market, therefore it is normal to observe differences between the Quotes offered by two separate providers at the same point in time.“
I told them the burden of proof regarding anything wrong with the Expert Adviser lied with them. In addition, I said:
“Although it is indeed possible to observe differences between the quotes offered by two separate providers at the same point of time, these need to be reflective of the real market price. Otherwise, a broker could adjust its prices as much as it sees fit to the detriment of the customer. The aforementioned construction is valid all over the world and my evidence shows that your quote was in perfect accord with the market rates. It follows that you were not authorised to adjust the price and I am entitled to all my profits and deposit.“
Later, they reiterated their previous arguments, stressing the particular provision in the contract and that was it. I was later told that a deadlock has been reached and that I could lodge a complaint to the Financial Dispute Resolution service.
GDMFX failed to produce any convincing evidence that the price was wrong. They merely stated that the real market price at 1:45:00 was 9,462. The attached Bloomberg shows that the price of 9,462 appeared in the market, however it is the - worst and - latest one. So, on the one hand GDMFX quotes the price of 9,462 at 1:45:00 which is in complete accord with the Bloomberg, but on the other it states that it does not reflect Bloomberg when saying that the original price of 9,442 was not present at 1:45:00.
Therefore, I believe that GDMFX was not authorized to cancel my trades because the originally quoted price was reflective of the market.