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PAMM accounts for non licensed money managers ??

wahjay (wahjay)
May 02 2013 at 19:54
41 posts
Hey guys,

So, I was looking into opening a PAMM account soon however I noticed that PAMM accounts in brokers such as Alpari can be opened by basically any trader ! The problem is : if you are not a licensed money manager by your country's regulator, managing other people's money even through your broker is normally illegal ! In my case, i'm in france and my broker FXCM told me all people doing that are totally being illegal since you should be registered as a money manager, cta or whatever..

So my question is simple : 99% of people on myfxbook are illegal? How come Alpari and some other brokers don't check their traders? Is it dangerous to open an account , dangerous as a crime or is it seen different by the law , depending on countries etc?

Thanks

FX Korner
KFIN
May 28 2013 at 19:23
1 posts
some brokers just need a limited power of attorney signed by an investor. they allow a pamm manager/trader trade on their behalf. if it's any help. so it's not illegal if they don't have a license.

wahjay (wahjay)
May 29 2013 at 16:24
41 posts
But wait, the broker might have a licence, but the money manager does not always. In that case who trades? well it's the unlicensed money manager = you accept funds and trade investors funds.

So.. i know some countries like france where this is completely illegal. Now once again my question is still left unanswered..

I'm not sure it's 100% legal if not properly done.

Thanks

Gary Sharp myfxpt com
myfxpt
Jun 03 2013 at 09:00
345 posts
I believe you can set-up as a PAMM manager with a broker outside your own legal jurisdiction, and provided you attract clientele from outside your legal jurisdiction, and outside other legal jurisdictions that require licensing (USA, Australia, UK, etc.), then you are doing nothing wrong.

By the way, all this ooh_aah about being regulated and licensed amounts to very little. Remember, it was those guys in $5,000 pin-stripe suits and degrees that gave us the Global Financial Crisis! 😎

forexpipcatcher
Jun 10 2013 at 05:33
286 posts
myfxpt posted:
I believe you can set-up as a PAMM manager with a broker outside your own legal jurisdiction, and provided you attract clientele from outside your legal jurisdiction, and outside other legal jurisdictions that require licensing (USA, Australia, UK, etc.), then you are doing nothing wrong.

By the way, all this ooh_aah about being regulated and licensed amounts to very little. Remember, it was those guys in $5,000 pin-stripe suits and degrees that gave us the Global Financial Crisis! 😎


Not 'gave us' you clown, gave you the Global Financial Crisis because your to stupid to capitalise on it.

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