First Public Comments Since 2023 Shutdown
The founder of My Forex Funds (MFF), Murtuza Kazmi, has spoken publicly for the first time since authorities forced the firm to shut down in August 2023.
Regulators halted the company’s operations after imposing asset freeze orders. A US court later dismissed the case with prejudice after identifying procedural misconduct during the investigation.
Allegations and Asset Freeze
The CFTC accused My Forex Funds of fraud at the time of the shutdown. The agency alleged that the firm acted as a counterparty to traders, manipulated order execution through software, and terminated accounts under false pretences. The regulator also claimed that the company generated more than $300 million in fees.
Kazmi said the investigation began without prior notice. Regulators froze both corporate and personal bank accounts within hours. The action prevented the company from continuing its operations.
Initial Company Statement
Following the freeze orders, My Forex Funds published an official notice on its X account. The company said that a Canadian provincial securities regulator and the US commodities regulator issued the orders without prior notice or discussion.
According to the statement, the orders prevented the firm from trading securities and accessing funds held in its bank accounts. The company said the measures left its business “effectively, and at least temporarily, frozen.” It also confirmed that courts scheduled hearings in both the United States and Canada to review the freeze orders.
Impact on Operations and Staff
Kazmi said the asset freeze had immediate consequences for the company. With no access to operating funds, My Forex Funds laid off its global workforce shortly after the shutdown.
He also said he could not access personal funds for several months. Employees and contractors lost their income with little warning.
Court Findings and Legal Costs
During the legal proceedings, the court found that the key information to obtain the asset freeze was. According to court filings, the agency presented tax payments made to the Canada Revenue Agency as personal transfers to Kazmi.
Following challenges by the defence, the court lifted most of the freeze on Kazmi’s personal assets. The proceedings also revealed procedural lapses during the investigation, including inaccurate testimony provided by the lead investigator. The CFTC later acknowledged shortcomings in how it handled the case.
In a subsequent ruling, a federal judge ordered the CFTC to pay more than $3.1 million in legal fees after finding that the agency engaged in litigation misconduct during the case. The ruling marked a rare outcome in enforcement proceedings involving a US regulator.
The case also drew public criticism from then-CFTC Commissioner, who said such conduct could not occur within a law enforcement agency.
Industry Comments and Next Steps
Although the court dismissed the case on procedural grounds rather than on the merits of the allegations, Kazmi said My Forex Funds would have prevailed if the case had continued. He also confirmed that the parties discussed a settlement but failed to reach an agreement.
Kazmi said the firm has begun regaining access to its assets and internal systems. He added that the company is reviewing its data and operations while assessing a possible return to the market. He did not confirm a relaunch timeline.
Questions remain about traders who awaited payouts at the time of the shutdown. Kazmi said the company has only recently regained access to its systems and will provide further updates after completing internal reviews.
As regulatory scrutiny of the prop trading sector increases, Kazmi said regulation will likely evolve as the industry matures. He added that he remains open to discussions with regulatory authorities.
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