Is it illegal to use non-registered Forex broker? (2024)

I used to think it was illegal for a US citizen to use a Forex broker that is not registered with the CFTC and NFA. But I just read an article that says it's not illegal, but it's just that it opens you up to more potential dishonest business practices with less legal recourse if you get scammed.

https://www.forexfraud.com/unregulated-offshore-brokers/

Can anyone offer more information?

its not a illegal to trade with no register trading broker , its your own choice. so never think this is.

it is not illegal to use a non-registered forex broker. However, without any regulations, your fund and yourself are at risk. If they scam you then there is nothing you can really do to get your money back. You can check tips to choose forex broker to help you make your own decision.

It is not even possible to get money back from a regulated broker. The regulators are just there to fill their pockets, there is no value to us.

That would be the ultimate slap in the face if they ultra restrict you as they have and then make it illegal to use workarounds. Regulation honestly is pointless in the US anyway. Your funds aren't protected and you're forced to use larger capital amounts to trade.

I'm sure the regulators would like to portray the image that it is illegal if it it's not. Scare tactics often keeps the sheep inside the pen and sitting underneath the big regulatory thumb.

Induced participation in activity, cannot be withdrawn

This currency trading platform operates bogus activities to induce clients to participate. After the client makes a profit, he says that he has to pay 20% of the tax and that the tax must be paid separately and cannot be deducted from the account. I already deposited all my money and I have no more to pay taxes. This regulation was not established before the activities. This is a fraud.

Synthesis, even though they are regulated there are companies that play by their rules, forgetting who they entrust their money to, a mystery on the rise

Find more valuable information regarding brokers in the following company.
https://www.wikifx.com/es/dealer/9941528702.html

Right
Not illegal
Just Stupid

It's not that US citizens are not allowed to use non-registered foreign forex brokers. It's brokers that are not registered with the US CFTC and NFA are not allowed to take clients who are domiciled in the USA. The onus is actually on the broker, not on the client. If CFTC and NFA find out a broker that's not registered with them is taking US client, they reserve the right to prosecute that broker. This is why you will see a majority of foreign brokers will not take US clients, and ironically they are actually the more reputable ones because they actually abide by this regulation. It's the more "interesting" ones that are unregulated brokers offshore who don't care about the law and many times the client's interest who would take US clients' money.

I do agree with the article that this practice doesn't really protect US investors but instead protects US brokers because it actually cuts US investors off from the honest foreign brokers that would be potentially in competition with US brokers since the honest foreign brokers who are regulated would actually be put off from taking US clients and leave them open to the potentially seedy brokers who are not regulated and many times are not even legitimate forex brokers because they are the only ones who don't care about the law but just money. And like many have pointed out, since these brokers are unregulated and not overseen by anyone, then the investors who invest funds with them are at the complete mercy of these brokers. They can do whatever they want with the investors' funds and there would be no recourse for the investors who've given them money.

If CFTC and NFA really want to protect US investors and really feel US investors would benefit the most from US-registered brokers instead of foreign brokers, then it should ban the investing from the US investors' side and not go after the broker. But then again when has CFTC and NFA looked after the investors? They have always lived in the pockets of their FCM members who pay a huge hefty CFTC/NFA membership fee.

Correct. However, it should be illegal to be that stupid.