CFTC Nabs $2.5M Victory Over Currency Trading Scheme - Law360

CFTC Nabs $2.5M Victory Over Currency Trading Scheme - Law360


CFTC Nabs $2.5M Victory Over Currency Trading Scheme - Law360

Posted: 30 Oct 2019 02:02 PM PDT

Law360 (October 30, 2019, 5:02 PM EDT) -- A Florida company must pay nearly $2.5 million for lying to investors about its foreign currency trading activities and for misusing funds, the U.S. Commodity Futures Trading Commission announced Wednesday.

Allied Markets LLC is on the hook for over $1.2 million in restitution and $1.2 million in civil penalties after a Florida federal court found the company violated trading laws, the CFTC said. It's also barred from all commodity-related activities in the future, the announcement said.

The company's principals, Joshua Gilliland and Chawalit Wongkhiao, were banned in March from further commodity-related activities, court documents show. The pair pled guilty in a...

Citi Scales Back Its Participation on Multi-Bank FX Platforms - Finance Magnates

Posted: 30 Oct 2019 10:36 AM PDT

Citigroup is suddenly reducing its global ambitions as a major FX trading powerhouse, cutting the number of third-party platforms it gives currency quotes to 15 from 45 by the first quarter of 2020.

The Financial Times today reported, citing people with knowledge of the matter, the Wall Street bank expects the scale back to save $5 million to $10 million in costs a year.  Citi has sent surveys to all forex platforms, which allows currency traders to pick and choose which banks they trade currencies with, asking them to identify their products, the fees, as well as other metrics.

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Multi-bank, multi-user platforms have revolutionized foreign exchange trading over the past decade but a person familiar with Citi's efforts told the newspaper that "in the grand scheme of things, the smaller platforms add very little value but a lot of cost, effort and energy goes into maintaining a presence on them. There is a feeling that banks are paying the bills to provide a "free option" for clients."

Citi is the fifth-largest currency trading firm by market share last year, after the likes of JPMorgan and UBS.

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Citi expands FX offering into Asia

From another perspective, however, other banking giants and major exchange groups have opted to position themselves to take an expanded role in the 6-trillion a day foreign exchange market.

Deutsche Börse, for example, was mulling the acquisition of Thomson Reuters' FXall, an electronic FX trading platform to corporations and asset managers. The move marked the German exchange's continued expansion motive in the foreign exchange space. It comes after nearly three years of Deutsche Borse's foray into FX ECN of its own with the acquisition of 360T, which turned to be the center of the exchange's global FX business.

Citigroup has made changes as it conducts an enterprise-wide review in the wake of a series of consumer scandals. Citi's FX prime brokerage unit has come under fire after staring down losses of as much as $180 million on loans to an Asian hedge fund. The unit was reportedly pulled from the currency trading division and put instead under the oversight of the lender's prime finance and securities services unit.

Elsewhere, the US bank has joined UBS AG to launch an electronic currency trading and pricing platform in Singapore, Asia's biggest foreign exchange hub. The new facility, which is slated to go live by the end of 2019, will support 23 spot currencies, including all those in the G10 group.

Singapore is the fourth forex trading engine location for Citi, which also has systems set up in Tokyo, New York, and London.

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