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Author Topic: BREAKING NEWS - Halifax FX Australia brokerage goes bust!  (Read 1920 times)

Offline jwatts7701

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BREAKING NEWS - Halifax FX Australia brokerage goes bust!
« on: November 27, 2018, 06:10:55 PM »
oh oh.  :-[

This popped up on my Finance Magnates Feed: https://www.financemagnates.com/forex/brokers/exclusive-halifax-investment-services-has-gone-bust/

It also looks like this means that Halifax FX NEW ZEALAND may also have gone under: https://www.stuff.co.nz/business/business-top-stories/108898732/nz-investor-fears-money-lost-after-helifax-nzs-australian-parent-company-goes-into-administration

This may be painful for a lot of traders. I hope that this has a good ending.

Offline drunkfx

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Re: BREAKING NEWS - Halifax FX Australia brokerage goes bust!
« Reply #1 on: December 21, 2018, 01:25:56 PM »
Hope they will refund their clients in full and have separate client accounts. Worrying news I should say

Offline iwillsurvive

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Re: BREAKING NEWS - Halifax FX Australia brokerage goes bust!
« Reply #2 on: December 25, 2018, 09:06:36 AM »
Do you know if their clients deposits are covered with deposit insurance? Or do you know if ASIC has deposit insurance for brokers regulated under their jurisdiction?

Offline jwatts7701

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Re: BREAKING NEWS - Halifax FX Australia brokerage goes bust!
« Reply #3 on: January 02, 2019, 12:57:46 AM »
Do you know if their clients deposits are covered with deposit insurance? Or do you know if ASIC has deposit insurance for brokers regulated under their jurisdiction?

No they don't. This is a misconception about ASIC brokers and why everyone wrongly feels so safe with them.

I have been researching this a bit lately. It is best to check for yourself on this but as it appears to me, the AUD gov offers insurance on ADIs (example - banks, credit unions and building societies) for up to $250,000. Not on forex brokers.

Your broker's money at an Australian bank would be protected under this scheme if the bank that you brokerage used went bust. But there is no compensation scheme for traders at a forex brokerage in Australia. Only client money rules, capital maintenance, and client arbitration services.

My understanding is that if you want full protection like that, really you need to trade in the UK.

But I think it may be optional for brokers to join those schemes in the UK for you to be protected up to the full $250k or not in the UK (so best to ask your UK broker to be sure).

I think it may only be on GBP deposits as well. So if you have an AUD account in the UK it wouldn't receive the protection. Someone from the UK can probably clarify that.

But my understanding is that the UK is far safer than Australia as it relates to investor compensation schemes, since Australia does not have any. But with ESMA changes the UK sure does have some drawbacks now to.

Offline iwillsurvive

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Re: BREAKING NEWS - Halifax FX Australia brokerage goes bust!
« Reply #4 on: January 03, 2019, 12:05:01 PM »
Yup. Or go for the bigger and well renowned brokers, like interactive brokers. The only problem is they don't have MT4. And if trading an EA, one would have to code it in java or C++ to get it to run on their API.

But seriously, if one is just trading manually, they are a good choice

Offline forexcandy

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Re: BREAKING NEWS - Halifax FX Australia brokerage goes bust!
« Reply #5 on: January 09, 2019, 08:38:15 PM »
If they were regulated by the authorities, I guess regular investors should get their money back.

Offline jwatts7701

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Re: BREAKING NEWS - Halifax FX Australia brokerage goes bust!
« Reply #6 on: January 16, 2019, 06:37:59 PM »
Unfortunately not the case Candy.

They are not regulated by the authorities like the cops or anything (although I am sure some could get criminally charged). There is no protection for FX brokers in Australia. Only ADIs (banks, credit unions etc).

The best you can hope for is that they followed client money rules, capital maintenance, etc. But this seems to be the very reason why some of them get shut down (like Berndale) because they don't follow these rules. In this case hopefully ASIC catches it before they go bankrupt.

It is not size either. I read that Halifax was backed financially by Lloyds bank. Also that FIXI was backed by Axitrader. So the financial strenght of some of these firms doens't seem to hold much weight.

 

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