Last year, in April 2020, Admiral Markets changed the terms for trading financial instruments without notice to traders. This happened when the prices of crude oil fell significantly. At the start of the Covid-19 pandemic, due to the events going on around the world, the price of crude oil fell so much that its price was negative.
To avoid complications, Admiral Markets decided to change the trading conditions, however, no prior statement was made by the broker prior to the decision. In addition, Admiral Markets has also increased commissions to keep positions open overnight.
Due to the steps taken by the broker, the Financial Control Authority decided to “punish” the broker by forcing him to pay a fine of 32,000 euros. According to representatives of the regulatory agency, the decision was made because the reasons for the decision were not disclosed to traders in a timely manner.
Admiral Markets is a well-known Forex broker, which offers its services to European traders.
The decision of the regulatory agency
While the action taken by the regulator to somehow punish the broker for not considering the interests of traders is fair, the amount of the fine is not. basically nothing for a company like Admiral Markets. Admiral Markets is a brokerage giant, the company made nearly 20 million euros in profit last year. 32,000 euros fine is nothing for such a company.
The regulator noted that the decision was made because many clients who purchased this trading asset had to restructure their positions, which was nearly impossible as the broker did not give traders any prior announcement or warning. on the measure he planned to do. .
How did the public react?
Admiral Markets’ decision was followed by a massive backlash from the public, especially the broker’s client. Many have claimed that this will cause Admiral Markets to lose its clients.
One of the users wrote that the decision was made “out of nowhere”, while another user wrote that after contacting the broker, he found out that the broker “had contracted on the contracts to term of December 2020 “.
Many others said that if the decision was announced before, many traders would not end up losing their money. On the other hand, representatives of Admiral Markets claim that they acted in the “best interests of its clients”, and the decision was made to ensure that clients would still be able to continue trading on global financial markets. However, he also noted that not all market specific circumstances were taken into account when making the decision.
It is still unclear why the company did not make any prior warnings or statements about the decision that was made. Most traders ended up finding out the actions taken by the broker only after executing the decision.