GUILTY Case# 2012-056 | Kovacs Norbert vs fxopen.com

[iwe]

wherever you trade, the t&c will be same. Brokers/Banks will not take any responsibility regarding technical error or whatsoever.

as for pricing, if the profit and trade ONLY can be done at particular broker at particular time, it means something wrong with the feed/server/execution.
If Mr. Kovacs trade action is done in other ECN, would it gives same result?

it's funny though to not accept something that you accepted in the first place. If you don't want your trade cancelled for whatever reason you should not accept fxopen t&c and you shouldnt trade with fxopen.

my conclusion is fxopen not guilty as other broker will do exactly the same regarding this situation.

 

[TraderChris]

If one goes to a shop, and buy a loaf of bread, and pays the price as indicated, and walk out the shop, the deal is done. The contract has been entered into by both parties, signed and concluded. If the price was too low, the shop has no recourse. If it was too high, the buyer has no recourse.

BEFORE the transaction has been done, the cashier can refuse to sell the loaf at the indicated price IF it is noticed before the transaction is concluded. And of course the buyer can refuse to pay the wrong price.

Same with Brokers. When one trade with a broker, and the broker accepts a trade at a price as indicated, the deal is done. If the broker complains about the feed being wrong, they should pay more for their infrastructure, and get better LP's. But they scrounge along with the bare minimum, and then are not prepared to allow the buyer - trader - to collect his winnings. Should the trader have traded into a loss at that stage, would they have refunded the loss? I doubt it...

Guilty. They are greedy bastards.

 

[mosske]

Looking at this case and its multitude of perspectives and points, I must say the least FXopen could have done was to handle things differently. For one thing, the issue of the LP in question. I for one would feel a certain level of comfort in knowing that they were at least taking measures to settle things with their LP to ensure this issue would not be repeated again. An apology is only an apology when there isn't a threat of legal action thrown in for additional 'flavor'. That was absolutely the wrong way to handle such a case. Hiding behind legal curtains that the client signed and NDA-protected-LPs is not the best way of moving forward.

How can we all feel safe knowing this may very well happen again? From some other members here, they've already reported similar cases. And if this does happen, do we expect the same level of handling as Mr Kovac received.

For me, I say Guilty on the basis of all the points I mentioned above. That was what did it for me.

 

[FXCobra]

I think we should look at this issue positively and learn something from it.

First of all, ALL TRADERS should take more time reading through Brokers Terms and Conditions before jumping in. I had interest in FXOpen so i took time to read their TCs and their rules governing/binding customer and broker. I found some issues uncomfortable like what happened to kovacs. I asked questions and they replied just exactly how they responded to Kovacs.

See sample of my disscusion with them: (Agreement terms on black, my questions on red their response on blue)

RE: Inquiry on Terms of Agreement (ECN Account) <!-- span class="attachments">This email has attachments</span-->2 1 recipients
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<dl class="details"> <dt id="hdr-from" class="hdr-info">FROM:Gleb Ivanov </dt><dt id="hdr-to" class="hdr-info">TO: onyeobike@yahoo.com </dt></dl> Message flagged
Wednesday, June 13, 2012 1:27 PM



<style><!-- _filtered #yiv699916545 {font-family:Calibri;} _filtered #yiv699916545 {font-family:Tahoma;}#yiv699916545 p.yiv699916545MsoNormal, #yiv699916545 li.yiv699916545MsoNormal, #yiv699916545 div.yiv699916545MsoNormal {margin:0cm;margin-bottom:.0001pt;font-size:12.0pt;font-family:"serif";}#yiv699916545 a:link, #yiv699916545 span.yiv699916545MsoHyperlink {color:blue;text-decoration:underline;}#yiv699916545 a:visited, #yiv699916545 span.yiv699916545MsoHyperlinkFollowed {colorurple;text-decoration:underline;}#yiv699916545 p.yiv699916545MsoAcetate, #yiv699916545 li.yiv699916545MsoAcetate, #yiv699916545 div.yiv699916545MsoAcetate {margin:0cm;margin-bottom:.0001pt;font-size:8.0pt;font-family:"sans-serif";}#yiv699916545 span.yiv699916545BalloonTextChar {font-family:"sans-serif";}#yiv699916545 p.yiv699916545msochpdefault, #yiv699916545 li.yiv699916545msochpdefault, #yiv699916545 div.yiv699916545msochpdefault {margin-right:0cm;margin-left:0cm;font-size:10.0pt;font-family:"serif";}#yiv699916545 span.yiv699916545balloontextchar0 {font-family:"sans-serif";}#yiv699916545 span.yiv699916545emailstyle18 {font-family:"sans-serif";color:windowtext;}#yiv699916545 span.yiv699916545emailstyle21 {font-family:"sans-serif";color:#1F497D;}#yiv699916545 span.yiv699916545emailstyle22 {font-family:"sans-serif";color:windowtext;}#yiv699916545 span.yiv699916545EmailStyle24 {font-family:"sans-serif";color:#1F497D;}#yiv699916545 span.yiv699916545EmailStyle25 {font-family:"sans-serif";color:windowtext;}#yiv699916545 .yiv699916545MsoChpDefault {font-size:10.0pt;} _filtered #yiv699916545 {margin:72.0pt 72.0pt 72.0pt 72.0pt;}#yiv699916545 div.yiv699916545WordSection1 {}--></style>Dear Sir,

Thank you for your enquiry and patience!
Hereby I disclose the answers from our legal department. I hope that we’ve fully satisfied your request and you will be ready to join our customers list.

Best Regards,

Gleb Ivanov
Sales and Marketing Manager
FXOpen NZ Limited
e-mail: gleb.ivanov@fxopen.org
Skype: gleb.ivanov.w
Tel.: +7 499-346-09-60 (ext. 188)
http://www.fxopen.com/

From: onye buchi[mailtonyeobike@yahoo.com]
Sent: 04 June 2012 18:16
Subject: Inquiry on Terms of Agreement (ECN Account)

Dear Sir,

I'm a prospective customer willing to open an ECN Account. Having studied your Terms of Agreements and other documents i have the following observations tbelow that requires clarification to enable me take the right decision. My observations/inquiries are on red

Your earnest reply would be highly appreciated.

Thank you.

Obike C. Onyebuchim

(Section of an answered question from FXOpen

CUSTOMER AGREEMENT
6. BUSTED TRADES
FXOpen shall have the right to annul and/or reverse any trades which are deemed untrue or opened at a fictitious price not existing on the market at the time of opening. (What do you mean by untrue or fictitious price. I suppose the price ought to come from your price feeds.)

While our ECN price-feed is determined by prices obtained from liquidity providers, technical issues and/or various market situations can lead to client orders being executed at prices, which do not actually correspond to those available in the platform’s liquidity pool. As one of possible examples, a liquidity provider could quote a price which later is deemed untrue market price by that liquidity provider and, as a result, the transaction gets cancelled by the liquidity provider or the liquidity provider changes the price at which the transaction is deemed executed.

I have attached the full questions and disscusions i had with them through their legal department as pertains issues like this.

I had intended to bring up the issues/discussion with fellow traders for better advise.

I think its high time the FPA innovate a solution to discuss and treat Broker Terms & Conditions on the forum.

If kovacs goes to court he might lose the case because he already signed an agreement with them, which protects FXopen from liabilities. However i'm of the view that he's original account should be restored and any incured expenses (fees) should be withdrawn, since it is the fault of their LP and they published reasons for price glitches.

Fellow traders please take time to read through brokers Terms and Conditions.

The FPA should read through the attached file and see reasons why this case might be hard for Kavocs.

I talked about that in a past post. The agreement between brokers and clients are full of complicated words filled in the sentences by "Smart" lawyers of the broker to defend it from any charge later on when the broker decides to work it badly or dirty against any client.

If a client want to read in every detail the agreement with each broker or company then will not open any account with any broker or company in this business because all agreements have nearly same contents.
The broker in another case when the broker servers get broken, can say its servers are very good nothing happened it's the client connection problems..etc
The broker can find many excuses under this agreement if want to play it that way.

But there is also something named Morals that prevent regulated & good brokers from doing that.

If technical problems are not covered by the broker and it share a disclosure with the LP against the client, then what do I want from a broker?! What other problems are more big than this?!!!

No person will open any account with any company if will only look at "Terms of agreement" and for your information the "Busted Orders" rule is found in most agreements.
Many brokers used the rule in a very dirty way, like instead of informing the client at same time of the error, they leave it normal till withdrawal time comes, to say No you can't get your profits because of this and that rule, some went far to make it from this to that date which counts a full month!!
But even with this rule, the broker doesn't show any proofs whatsoever that the LP sent wrong prices to it which proofs that the broker is just creating any excuse to rob the client just as Fxopen had done to Kovacs.
There's another case with FXDD, the NFA charged the broker for playing with market prices manipulating it against its clients
Don't know how much charges FXDD must get to learn to stop their dirty games!! Looks like forever!
Those brokers must prepare a big shelf to set the received trophies of Charges and Scams on

 

[FXCobra]

wherever you trade, the t&c will be same. Brokers/Banks will not take any responsibility regarding technical error or whatsoever.

as for pricing, if the profit and trade ONLY can be done at particular broker at particular time, it means something wrong with the feed/server/execution.
If Mr. Kovacs trade action is done in other ECN, would it gives same result?

it's funny though to not accept something that you accepted in the first place. If you don't want your trade cancelled for whatever reason you should not accept fxopen t&c and you shouldnt trade with fxopen.

my conclusion is fxopen not guilty as other broker will do exactly the same regarding this situation.

Do not make the case look natural or normal to defend Fxopen saying that happens with all brokers!!

That's totally wrong. There are still Good Brokers out there, not all treat their clients the way Fxopen had done.

You said something was wrong with feed/execution/server, who's responsible of that if not the broker, ME!!

For your info, once there was a problem with one of my brokers in its servers, didn't update for 1 hour and I had open orders with take profit and stop loss. As I was following the market price with my other brokers, price reached to my take profit but at that time the broker servers were still down, so take profit wasn't filled and orders kept open when the broker servers got to normal status.
Only a live chat with the broker had fixed my problem, took the orders info and what made me relax is a simple sentence by the broker who said: " We fix our mistakes" Those little words left me glad that my account money is safe with this broker, and that's what happened the mistake got fixed at same day.

It's not funny to accept the agreement with a broker to then complain on a cheat by broker because it can create any dirty excuse, this time was LP excuse in Kovacs case, next time might be market conditions lead to your Stop loss to be filled even if it was some 50 pips far of at that time

 

[tamem]

hi guys if you want to say Fxopen is guilty you mean all fxbrokers are!!!
i think they are NOT guilty because the have no reason to do so they only take commission from ECN accounts they do not trade against the client, why then losing a client for nothing !!!!!

NOT Guilty

 

[Boko Maru]

hi guys if you want to say Fxopen is guilty you mean all fxbrokers are!!!
i think they are NOT guilty because the have no reason to do so they only take commission from ECN accounts they do not trade against the client, why then losing a client for nothing !!!!!

NOT Guilty

You joined FPA 1 minute before making your post. So your sole reason for joining FPA was to make this post that FX Open isn't guilty?

And fyi, FX Open indicates right on the website that they offer both ECN accounts and "standard" accounts with no commission (i.e. they are market maker accounts that trade against the client). But in my opinion that's BS anyway, as I don't think they have any LP's whatsoever or any true ECN accounts at all. If they do, who are the LP's? My broker directly names all of their LP's. My take-FX Open is 100% bucketshop with no LP's at all. It just sounds good pasting that crap on a website, and then when they lose money to a profitable trader, they can blame it all on some mysterious (and always un-named) LP whose fault we're supposed to believe it is.

 

[RahmanSL]

I really don't know what we are voting for here.

1) Are we voting to declare FxOpen as a scam broker??
My reply in an earlier post was & still is:
No, I do not believe FxOpen is a scam broker in the real sense of the word that it scam their client's money & profits.
I have known & have live trading accounts with them for over two years and I know so.

2) Are we voting to declare that FxOpen should reinstate all "profits" made by Kovacs due to FxOpen alleged LP errors??
My view is that, this is still very much debatable because some facts just doesn't add up.
For example, Kovacs is an experienced trader of 11 years (see post#13 in his first thread) and in that time he know or should know when quotes indicated in his platform are off market quotes. He should know right away that something is wrong BUT he went ahead to open trades to take advantage of that abnormality anywhere(yes, no doubt, it's FxOpen's LP false feeds).

In Kovacs first screen attachment, the 2nd item states: Balance....600 (I take that to mean usd600)....but yet, Kovaces dare to make ever larger trade lot sizes with that small account and culminating in making 20.0 lot size trades.
For a seasoned trader with 11 years experiences, making such large trades is a no-no as that breaks all rules in good money management.
Even I, with just almost 3 years of forex experiences would not nor have ever made even one single 20.0 lot size trades on my largest trade account of just over usd23k. That would be suicidal and downright stupid.

So, in my own personal view, too many facts surrounding Kovacs' trading suggest he knew of the price abnormality and he took advantage of that fact even though he also know (or should know) almost all brokers will not allow such profits, made from trading off-market prices, to be kept by traders.

Since I don't know what we voting here, and though as one of the senior FPA member its my duty to vote, I will have to abstain from casting my vote.


However, I still hold fast to my statement that FXOpen representatives handled this case rather sloppily and arrogantly too.
If that goes up for vote, it will most certainly be a big fat "YES" from me.

 

[Cleeon]

Thanks to GOD and administration of ForexPeaceArmy.com here.
I just voted for this polls

Accept it, You and Me is same here, just a new member, based on Your post amount, lol.

Your comment is too much, which honestly I don't want to read all of it, but, in fact, hmm..I did it, read all of Your post including any mockery comment from You about Me.

You and Me, like other trader who join through all broker in this world to make transaction on capital market, must do the same everytime, what is ? read all terms and agreement, understand about it, then accept it, that is one of main requirement.

Seriously dude, You and Me must be neutral peoples here, just like ForexPeaceArmy.com staff include admin, must be in neutrall position, except You are Mr. Kovacs lawyer or His friend who decided to be in His side, that's not problem.

trader is like investor at investment place, I see You just like an investor who invest some money, then if the money manager fail to make You happy, then You be angry and use not professional words or comments.

keep Your emotion and do research, if needed do any legal way, not just argue with comment from emotion. that is childish.

I can keep posting here as long as I like and as long as I am not break any rules of this community forum, You not the owner of this website and do not have right anyway except You find Us have break any rules here.

about Your question, read again post above

" How can that happen anyway, LP send the broker prices just to Kovacs account?!?!
sure not, that why I said not just Mr. Kovacs, the trader who affected caused this error,
sure, do You not believe us, maybe, that normal

follow My suggestion, You can easily ask, survey, or maybe do interview to other FXOpen trader at Their official forum.

the answer would be same.

just same as other business, as trader, We must understand "how it works" before join.

I couldn't hold myself from replying to this nonsense post. What the hell did you say!?? Do you know what you wrote!!
Thank God that such new members can't vote. As one member said in a forum of FPA that there must be some kind of pick for professionals to vote on cases not any person that can be one of the Scam broker friends comes here to vote in its favor. Don't know how 19 members! voted Not Guilty anyway!!
Fxopen already admitted that its their LP mistake which mean they must take full responsibility and pay Kovacs his money profits.

Did you ever read the case or know what's going on here or someone told you write what you posted?!!
What Fxopen returned Kovacs his loss and the client want more compensation and the client trades were loss, are you talking about!!
You're talking about false things that never happened and picturing Kovacs as if being greedy, you know nothing what's happening in this case. your post words prove that.
You made me laugh when you said Kovacs will loose if he followed a "legal way of law"
Seriously, do you know that this is FPA website or you passed through by accident or kicked here by Fxopen!
Don't know why such people comment on FPA.
Sorry FPA Admins for the tough words in my post but some people drive you crazy when they post against facts.

But for example what is this: "Mr. Kovacs must accept, he is just one of trader who affected cause that error price and get prize from FXOpen as compensation cause FXOpen already accept that mistake and pay his and other trader loss trade."
Really! Are you serious or normal!!
The first rubbish is saying "just one trader affected cause of that error price" How can that happen anyway, LP send the broker prices just to Kovacs account?!?! or What "prize" or Fxopen "accept that mistake and pay his loss trade" are you talking about?!!?
Make us all a favor by going to Fxopen take your commission for this post and stop posting here if you are enough with 1 commission per post

 

[antonisk]

hi guys if you want to say Fxopen is guilty you mean all fxbrokers are!!!
i think they are NOT guilty because the have no reason to do so they only take commission from ECN accounts they do not trade against the client, why then losing a client for nothing !!!!!

NOT Guilty

First post = not guilty for FXOpen ?
The issue here is not about a broker trading against a client the issue is that the broker's LP makes a mistake with the feed.

Furthermore i do also believe that FXOpen is not a scam broker but referring to this case they were wrong. FXopen should Compensate the client take the hit for the bad LP feed and try to correct/limit this kind of risks. Doing this you have a happy customer + no exposure to bad reputation and all this fuss in the FPA.