Lightning McQueen
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what would be good if the current worldspreads story was merged into 1 thread, pain in the **** trying to follow it all day on several threads 
Lightning McQueen
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breaking news from lmq world broadcast news inc.
latest pictures outside yet another spread bet firm today
simon holding the fort at his front desk
kpmg auditors looking confused as they search fruitlessly in the vaults across the spread bet industry for the whereabouts of client monies in the aftermath of the infamous spread bet run of 2012
latest pictures outside yet another spread bet firm today
simon holding the fort at his front desk
kpmg auditors looking confused as they search fruitlessly in the vaults across the spread bet industry for the whereabouts of client monies in the aftermath of the infamous spread bet run of 2012
My point was this looks like a fraud - company specific.. MF Global running into trouble didn't cause a run on all brokerages - not down playing the serious nature of this issue at all but is it the end of spread betting ? - Id be asking more questions from Ernst & Young, who signed off the accounts.
Lightning McQueen
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yes, i had been thinking on the same lines too about the accountants. must have looked ok at the time they looked? they'll have the same get out clause as an mot station if your car falls in half after the mot. "it was ok when we took a look guv"
due to the news reports about amount of time people have been left waiting for their funds to be returned in the mf global fiasco. i would have thought that keeping large amount of funds in any one institution would be foolhardy imv.
although i'm being rather flippant about the whole affair, probably shouldn't, but don't really foresee how this would cause much trouble within the industry?
maybe black swan could comment on the cmc position?
That would not be an easy thing to do---if possible. The first thing is not to have, anywhere near, that kind of money in their hands. I would be with a broker if I was in that position. Whenever I am involved in transferring, in or out, the blind period between the bank and my account with them always involves phone calls, with me protesting about the delay. They are using clients' money for their own purposes when that happens. It has to be that.
I suspect they have been up to all sorts. In my wifes case the disputed £30k suddenly reversed out of her account despite there being an on going investigation. So it registered as a zero balance. If you do that multiple times to winning balances then your cash position takes on a much healthier look and you know that it takes months for matters to settle at which stage you have moved onto other accounts. The new people coming in will immediately see that there could be potentially huge liability hence call in FSA.
Worldspreads are officially bust
WorldSpreads to be closed over alleged fraud - FT.com
I guess all fellow Worldspreaders are going to find out just how well protected our funds are from the FSA.
I find it hard to believe after all the scandals over recent years that this kind of fraud can still happen.
WorldSpreads to be closed over alleged fraud - FT.com
I guess all fellow Worldspreaders are going to find out just how well protected our funds are from the FSA.
I find it hard to believe after all the scandals over recent years that this kind of fraud can still happen.
Re: Worldspreads are officially bust
I'm not surprised that none of the other companies wanted to buy them out. Fraud on such a scale makes the brand completely toxic to existing or any future customers.
Shouldn't some senior manager or director have been receiving a daily reconciliation statement showing the total value of customer accounts and the amount of funds in the segregated bank account ? I would think that is difficult to falsify by such a large margin.
I'm not surprised that none of the other companies wanted to buy them out. Fraud on such a scale makes the brand completely toxic to existing or any future customers.
Shouldn't some senior manager or director have been receiving a daily reconciliation statement showing the total value of customer accounts and the amount of funds in the segregated bank account ? I would think that is difficult to falsify by such a large margin.
Re: Worldspreads are officially bust
Ok guys I'll tell you everything thats been going on their I have a relatively good knowledge. It all started a few years back when a company known as CMC markets came onto the block and started heavily advertising. Their profits were off the charts and they receive huge amounts of investment.
They subsequently listed and received investment from Goldman Sachs and a number of other large banks/funds.
However no sooner was this done than the FSA found out about positions not being hedged companies making huge amounts of money by purposely mis-quotings prices etc... CMC Markets de-listed, goldmans made a huge loss and their reputation was in tatters. Since then Worldspreads have been slowly hiring the exact same team for their own hedging department and even one of their customer services boys as a "trader" that comes on Bloomberg some times. They have bought into the company their knowledge of how to shaft a customer + a zero care attitude towards compliance. If you've ever worked in brokerage like me you will know that companies like this don't make money on the spread like you think they would... They actually making money on hedging a net position at the end of the day and then letting net losing trades run and taking the loss as profit for themselves. 99.99% of all FX brokers make money this way and its fine to do so regulatory wise.
Worldspreads problems have been ongoing for a while now but the real problem has arised over the last 3 months. They were losing big on net running positions and now it seems they have been using their managed funds facility to run up huge debts on clients "secured" deposits.
The moral of the story is that if you ever see a company offering 0 spreads, without some sort of admin or comission charge, you should run a country mile!!!!
Ok guys I'll tell you everything thats been going on their I have a relatively good knowledge. It all started a few years back when a company known as CMC markets came onto the block and started heavily advertising. Their profits were off the charts and they receive huge amounts of investment.
They subsequently listed and received investment from Goldman Sachs and a number of other large banks/funds.
However no sooner was this done than the FSA found out about positions not being hedged companies making huge amounts of money by purposely mis-quotings prices etc... CMC Markets de-listed, goldmans made a huge loss and their reputation was in tatters. Since then Worldspreads have been slowly hiring the exact same team for their own hedging department and even one of their customer services boys as a "trader" that comes on Bloomberg some times. They have bought into the company their knowledge of how to shaft a customer + a zero care attitude towards compliance. If you've ever worked in brokerage like me you will know that companies like this don't make money on the spread like you think they would... They actually making money on hedging a net position at the end of the day and then letting net losing trades run and taking the loss as profit for themselves. 99.99% of all FX brokers make money this way and its fine to do so regulatory wise.
Worldspreads problems have been ongoing for a while now but the real problem has arised over the last 3 months. They were losing big on net running positions and now it seems they have been using their managed funds facility to run up huge debts on clients "secured" deposits.
The moral of the story is that if you ever see a company offering 0 spreads, without some sort of admin or comission charge, you should run a country mile!!!!
ZEN archer
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Re: Worldspreads are officially bust
Good to get some insider info
What do you think about CMC nowadays? Have they changed for the better?
So far as I know they (CMC) started spread betting service in 2001 (they were called deal4free if I'm not mistaken)
Good to get some insider info
What do you think about CMC nowadays? Have they changed for the better?
So far as I know they (CMC) started spread betting service in 2001 (they were called deal4free if I'm not mistaken)
Re: Worldspreads are officially bust
I hope so aswell mate but as you know the CEO resigned last wednesday... He obviously knew what was about to go down. The FSA has a £50,000 security for all clients however this is not insured by the FSA it is a mear requirement that they guarentee to secure based upon an annual payment made by the Financial institution to the FSA. Because of this fraud that has been taking place we dont even know if they are still or have been regulated by the FSA for the past few months. They have no MIFiD license so they aren't secure under the investor compensation fund. All we have to do is hope that the their net loss (which was going to be announced at around £10-12 million is less than their final value upon liquidation. Or... that when IG or LCG buy out their client book, they get it for a hugely reduced sum and they take on the net position which would be the smartest way of helping the clients out.
I hope so aswell mate but as you know the CEO resigned last wednesday... He obviously knew what was about to go down. The FSA has a £50,000 security for all clients however this is not insured by the FSA it is a mear requirement that they guarentee to secure based upon an annual payment made by the Financial institution to the FSA. Because of this fraud that has been taking place we dont even know if they are still or have been regulated by the FSA for the past few months. They have no MIFiD license so they aren't secure under the investor compensation fund. All we have to do is hope that the their net loss (which was going to be announced at around £10-12 million is less than their final value upon liquidation. Or... that when IG or LCG buy out their client book, they get it for a hugely reduced sum and they take on the net position which would be the smartest way of helping the clients out.
Re: Worldspreads are officially bust
In regards to CMC, yes they have changed because if they hadn't they wouldn't have survived.
A lot of people go around these days trying to blight the reputations of brokers forums like this and FPA do harbour more "angry traders" rather than genuine cases of dodgy goings on.
I do trade now and again and the first this I would look for in a broker these days would be longevity.
Look for a company that has been around for at least 7-8 years. Any company other than this is most likely running huge net losses due to ridiculously high marketing budgets.
An example of a company like that is FX Pro.
They look really good on the eye, they sponsor 2 major football teams in the UK spending millions of pounds yet the only reason they survive is because they have a millionaire backer. The same is the case with all the other new brokers...
If you guys watch any bloomberg ads these days you will see that loads of companies promote "no dealing desk" or "STP" (straight through processing) because it gives you guys the trader, the confidence that your trades won't be meddled with however the real cruz of the scenario is that really non of your trades go into the market place. The broker decides what to place and what not to... The easiest way to get around this and be 100% secure is just don't use a regular broker. Go with a bluechip company like aka a huge back that has a retail FX division. In the UK the 2 major ones are Barclays FX and also Societe Generale FX. Go with them if you want no hassle.
In regards to CMC, yes they have changed because if they hadn't they wouldn't have survived.
A lot of people go around these days trying to blight the reputations of brokers forums like this and FPA do harbour more "angry traders" rather than genuine cases of dodgy goings on.
I do trade now and again and the first this I would look for in a broker these days would be longevity.
Look for a company that has been around for at least 7-8 years. Any company other than this is most likely running huge net losses due to ridiculously high marketing budgets.
An example of a company like that is FX Pro.
They look really good on the eye, they sponsor 2 major football teams in the UK spending millions of pounds yet the only reason they survive is because they have a millionaire backer. The same is the case with all the other new brokers...
If you guys watch any bloomberg ads these days you will see that loads of companies promote "no dealing desk" or "STP" (straight through processing) because it gives you guys the trader, the confidence that your trades won't be meddled with however the real cruz of the scenario is that really non of your trades go into the market place. The broker decides what to place and what not to... The easiest way to get around this and be 100% secure is just don't use a regular broker. Go with a bluechip company like aka a huge back that has a retail FX division. In the UK the 2 major ones are Barclays FX and also Societe Generale FX. Go with them if you want no hassle.
ZEN archer
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Re: Worldspreads are officially bust
Thanks aj11.
TBH I don't care if the trades go into the market or not so far as they quote market prices without slippages/delays/unrealistic spreads/platform problems and other tricks.
Thanks aj11.
TBH I don't care if the trades go into the market or not so far as they quote market prices without slippages/delays/unrealistic spreads/platform problems and other tricks.
WorldSpreads to be closed over alleged fraud - FT.com
Worldspreads finds hole in accounts, calls in administrators | ShareCast - News you can use
As a result of further investigation, the board of directors believe that as at close of business on Friday, 16th March 2012 there was a shortfall of client money at WorldSpreads Limited of some £13m and that gross amounts owed to clients are in the region of £29.7m, whereas the total cash balances available to the company are around £16.6m.
WS, one of the biggest SB co's???
Worldspreads finds hole in accounts, calls in administrators | ShareCast - News you can use
As a result of further investigation, the board of directors believe that as at close of business on Friday, 16th March 2012 there was a shortfall of client money at WorldSpreads Limited of some £13m and that gross amounts owed to clients are in the region of £29.7m, whereas the total cash balances available to the company are around £16.6m.
WS, one of the biggest SB co's???
Last edited:
stevespray
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Re: Worldspreads are officially bust
Special Administrators appointed to Worldspreads Limited
Upon the application of the directors of Worldspreads Limited, the High Court has today appointed Jane Moriarty and Samantha Bewick of KPMG LLP as joint special administrators of Worldspreads Limited, under the Special Administration Regime (SAR). Worldspreads Limited is a wholly owned subsidiary of Worldspreads plc, a company incorporated in Dublin, Ireland.
The administration of Worldspreads Limited follows the discovery of accounting regularities which the company became aware of during the course of Friday 16 March 2012. Following this it quickly became apparent that there was a shortfall in client monies and the directors and their advisors concluded that the best course of action, in order to mitigate losses for clients, would be to place the company into special administration.
For all non-press queries, please contact:
020 3284 8829
The administrators will respond to your query as soon as possible.
Press requiring further information please contact:
Sorrelle Cooper, Senior PR manager, KPMG in the UK: +44 20 7694 8527
[email protected]
Notes to Editors:
About KPMG
KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with nearly 11,000 partners and staff. The UK firm recorded a turnover of £1.6 billion in the year ended September 2010. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 150 countries and have more than 138,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG International provides no client services.
Special Administrators appointed to Worldspreads Limited
Upon the application of the directors of Worldspreads Limited, the High Court has today appointed Jane Moriarty and Samantha Bewick of KPMG LLP as joint special administrators of Worldspreads Limited, under the Special Administration Regime (SAR). Worldspreads Limited is a wholly owned subsidiary of Worldspreads plc, a company incorporated in Dublin, Ireland.
The administration of Worldspreads Limited follows the discovery of accounting regularities which the company became aware of during the course of Friday 16 March 2012. Following this it quickly became apparent that there was a shortfall in client monies and the directors and their advisors concluded that the best course of action, in order to mitigate losses for clients, would be to place the company into special administration.
For all non-press queries, please contact:
020 3284 8829
The administrators will respond to your query as soon as possible.
Press requiring further information please contact:
Sorrelle Cooper, Senior PR manager, KPMG in the UK: +44 20 7694 8527
[email protected]
Notes to Editors:
About KPMG
KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with nearly 11,000 partners and staff. The UK firm recorded a turnover of £1.6 billion in the year ended September 2010. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 150 countries and have more than 138,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG International provides no client services.
