CFTC fines Gain Capital UK nearly $500K for registration and supervision violations

The Commodity Futures Trading Commission (CFTC) issued an order yesterday settling charges against Gain Capital UK Limited for violations in supervision and handling of a customer account managed by an unregistered commodity trading advisor. The watchdog ordered Gain UK to pay a $250,000 civil monetary penalty and to disgorge $241,671.

The CFTC discovered that between February 2014 and March 2019, Gain UK, operating the group’s retail brands and City Index, offered services to US retail forex customers without RFED registration as required by the Commodity Exchange Act (CEA) and CFTC regulations.

CFTC penalty

The regulator alleged that Gain UK failed to supervise diligently its US forex customers and missed warning signs of the underlying fraudulent conduct by an unregistered CTA. The company had extensive communication about creating an account with the company with an unregistered CTA with knowledge that the CTA had been rejected from managing accounts with Gain UK and its affiliates because it was soliciting managed accounts through social media and a website without CFTC registration.

Due to the unregistered CTA’s fraudulent conduct, a customer lost $280,000 while Gain UK earned $241,671 in commissions.

Read More:

Read Also: