Gain Capital Fined Over Customer Order Malfunction

The US National Futures Association (NFA) has fined Gain Capital $50,000 for “failing to favourably adjust all customer orders adversely impacted by a recurring malfunction” in its e-platform. Gain neither admitted nor denied the charges and proposed to settle the case by paying the fine.

The charges related to trade data submitted to NFA in 2017 by Gain which  indicated it had recompensed a customer’s account. When questioned on the matter, Gain told the NFA the customer had placed several identical orders on the platform but when the price became available only one was filled. The credit was to provide the client with the profit the unexecuted trades would have filled.

Gain also advised NFA that it had received several other complaints from “a small number” of customers afflicted by the same problem and had recompensed them, however further investigation showed that between April 2016 and August 2017 over 7.400 customers were affected by the malfunction, for a total monetary loss of $167,100.

Gain applied adjustments to all affected accounts and customers positively impacted by the malfunction retained any benefit, however NFA claimed that Gain “failed to take timely steps to assess the extent of customer harm and make appropriate adjustments to all affected customers in a timely fashion…”

Colin Lambert

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