Bailed Out FX Broker FXCM Says It Was Hacked, Resulting In "Wire Transfers From Customer Accounts"

Tyler Durden's picture

It has not been a good year for retail currency broker FXCM which in January faced massive losses in the aftermath of the shocking Swiss Franc revaluation. In fact, only a $300 million bailout from Jefferies/Leucadia allowed the currency trader to meet regulatory requirements and continue operations.

Then, this morning, FXCM clients woke up with even more headaches when the currency broker admitted it had been hacked, leading to a "small number" of unauthorized wire transfers from customers’ accounts. FXCM said it received an email from a self-proclaimed hacker who claimed to have access to customer information. The company said it is working to establish the scope of the breach and identify affected customers.

Not a bad idea: hack clients accounts, then quietly syphon money out.

So, blame the Chinese again? That would be awkward after Xi Jinping's visit with Obama last week.

But more importantly, will this be the final straw for FXCM, and will the broker's client decide to give the already teetering company one more chance? Perhaps the biggest question is why would anyone still want to trade FX when this is clearly the domain of the central banks, and anyone with a less than infinite balance sheet get stopped out virtually on a daily basis, especially once the momentum igniting effect of the HFT algos is added.

As a final remember, FX trading is the one venue where HFT firms like Virtu are betting their on. Expect even more grotesque moves in any given FX pair as liquidity in this critical market evaporates to nothing.

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JBilyj's picture

You can only withdraw from them if the bank account/card was used to make the initial deposit. This is too shady to me, forget this FX BROKER!!!

DeadFred's picture

They have to pay for those planes they just put into Syria somehow. Or is it all the fault of the Chinese... I keep forgetting who's the bad guy... besides Obama, he's easy to rememeber.

Newsboy's picture

The dog ate your lunch.

Slomotrainwreck's picture

... hacked, leading to a "small number" of unauthorized wire transfers from customers’ accounts

Programmer Joe - Hey Al, what's this field for? it's contents are "AUTH".

Programmer Al - Those clients are authorized to transfer funds.

Programmer Joe - So, how is it controlled?

Programmer Al - DUH! You just type in "AUTH".

Programmer Joe - Cool!

Monetas's picture
Monetas (not verified) Oct 1, 2015 8:04 AM

Funny how things "burn" .... when you can't sell them .... life is funny that way ?

DeadFred's picture

Arrgh! the money is gone from my account. Who could have guessed QWERTY wasn't a good password?

CheapBastard's picture

That hacked money will find its way into a McMansion in Cali or NYC. No questions asked these days. DOJ looks the other way.

delete entry's picture

"As a final remember, FX trading is the one venue where HFT firms like Virtu are betting their on."

what is this sentence saying?

konputa's picture

delete entry, I think it's saying they lost their "ass" in that sentence.

delete entry's picture

sadly people are predictable enough for virt to make monies like clock work

Pa Kettle's picture

"Paul is the Walrus. Paul is dead."

LawsofPhysics's picture

LOL!!!  Yes, the money has all been transferred to Langley!

Or maybe Bluffdale UT, but you get the idea!

LawsofPhysics's picture

Some semblance of an actual market explains the 21% interest in the 70's.

Please, this is NOT the 70's, not by a long shot.

JLM's picture

The reason to have a FXCM account to to have the data free of charge.  Open an account, put a few thousand in and watch and learn.

LawsofPhysics's picture

Interesting.  You are not the first person I have heard say this.  Knowledge is power I guess.  In a race to the bottom, this might be a good idea.

Ban KKiller's picture

Crooks stealing from crooks. Big fucking deal. 

cougar_w's picture

Has anyone seen Jon Corzine recently?

oracle of YYC's picture

Exactly what I was thinking...When did POS Corzine start running this company!!

insanelysane's picture

This has Corzine written all over it.  It's at least from his playbook.  Company needs revenue next thing you know hackers just happen to take money from client accounts but not from company accounts.

Stlouiemike's picture

Speaking of money and in this instance Dollars, has anyone else noticed that all the bills(20 and under) are all old used up bills?  Even the banks and atms are spitting out these washed out bills.  Up to a few months ago it seems like all the banks and retailers were passing out the new sticky bills.  Wonder if it means anything?

cougar_w's picture

The Fed are getting ready to issue a new currency next year just in time for NIRP.

Albertarocks's picture

Oh... the old Mark Karpeles Mt. Gox trick?  By the way, Karpeles is finally in jail in Japan last I heard.