Information To All Traders

athenafx

AthenaFx Representative
Messages
172
If a broker claims to operate from Switzerland, he must be registered, regulated AND own a banking license.

Swiss based forex brokers must comply with directive 3a. Companies holding customer funds in trading accounts MUST have a banking license issued by FINMA (Swiss Financial Market Supervisory Authority).

You can read more at : http://www.finma.ch/e/finma/publikationen/Documents/finma_jb_2011_e.pdf

This directive eliminates bucket shops because they won't be able to get a banking license.

This way, it is not possible to cancel trades without authorization, confiscate client funds or manipulate prices after executing the trade.
 
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Pharaoh

Colonel
Messages
19,729
This way, it is not possible to cancel trades without authorization, confiscate client funds or manipulate prices after executing the trade.
I'm not sure I'd ever use "not possible" to describe regulation absolutely preventing stupid broker tricks. :)

I think, "very difficult" along with "providing easy ways for traders to get abuse issues resolved" is probably the the best we can hope for.
 

athenafx

AthenaFx Representative
Messages
172
The Swiss authorities have enforced the laws so that the consumer gets a better protection.

Swiss based brokers display the required information on their web site.

Nevertheless, the consumer has to keep on doing his homework by checking the information.
 

yideng

Private, 1st Class
Messages
44
What's the benefits to open the business in Switzerland instead of other financial center?
 

Pharaoh

Colonel
Messages
19,729
If a company is regulated in Switzerland, this would be considered to be a good thing by many traders. Unfortunately, many unregulated companies just open a virtual office in Switzerland and brag about having a Swiss address in hopes that people will assume that the Swiss address means that they are regulated.

Those companies are really no more "Swiss" than the Swiss cheese that comes from Wisconsin. Unlike a package of Swiss cheese, those not-really-Swiss companies want you to trust them with large amounts of your hard-earned cash.
 
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