Robbins Arroyo LLP: Global Brokerage, Inc. (GLBR) Misled Shareholders According to a Recently Filed Class Action
Robbins Arroyo LLP announces that a class action complaint was filed against Global Brokerage, Inc. (formerly known as FXCM, Inc.) (NasdaqGM: GLBR) in the U.S. District Court for the Southern District of New York. The complaint alleges that officers and directors of Global Brokerage, Inc. violated the Commodities Exchange Act and New York, California, Wisconsin, Oregon, and South Carolina consumer laws between March 1, 2010 and February 6, 2017. Global Brokerage provides online foreign exchange trading and related services to retail and institutional customers worldwide.
Global Brokerage Accused of Taking Advantage of Its Customers
According to the complaint, Global Brokerage’s customers placed trade orders through the company’s “No Dealing Desk” (“NDD Platform”) while Global Brokerage publicly stated that the company had no conflict of interest in the outcome of trades made on the NDD Platform. Global Brokerage specifically acknowledged that its conflicts-free business model was a “core” philosophy of the company. However, Global Brokerage had an undisclosed financial interest in the market maker that consistently won the largest share of Global Brokerage’s NDD trading volume, Effex Capital, LLC (“Effex”). Effex was created by Global Brokerage and allowed Global Brokerage to hold positions opposite its customers and financially benefit at its customers’ expense. Global Brokerage’s financial statements thus violated U.S. Securities and Exchange Commission regulations and generally accepted accounting principles for failing to disclose Global Brokerage’s economic interest in and control over Effex. On February 6, 2017, the U.S. Commodity Futures Trading Commission announced a settlement of charges against Global Brokerage and its two founders, which imposed a civil penalty of $7 million and banned Global Brokerage from operating in the U.S.
Global Brokerage Shareholders Have Legal Options
Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Leonid Kandinov at (800) 350-6003, or you can complete the form below and we will contact you directly.