The Client has lodged this complaint with the The Financials Commissions on the following grounds:
The Client used account # 1804263035 (USD) for active trading operations with FX market instruments and CFDs. Prior to the incident the Client opened one Long position with the financial instrument BTCUSD. Also, the Client attached pending Stop Loss and Take Profit orders to the specified position. The incident on the Client’s account occurred on August 12, 2022, in the period between 22:45:03 and 23:30:05 (GMT).
The chronology of events in the specified period of time, before and afterwards developed as follows:
• At 21:16:21 Long position # 75210080 was established on the Client’s account (@24174.63).
• At 21:16:29 the Client set pending Stop Loss (@24061.85) and Take Profit (@24248.43) orders.
• At 22:45:03 the Client tried to change the parameters of his Take Profit order (@24248.43 > @24800) but failed to do so because of a technical issue with the Broker’s platform.
• At 23:05 the Client contacted the Broker’s Customer Service regarding the platform’s failure and asked them to change the parameters of his pending Take Profit order.
• At 23:05 the Broker acknowledged technical issues on their side and asked the Client to wait until the full recovery of their service.
• Between 23:13:44 and 23:29:07 the Client tried several times to change the parameters of his pending Take Profit order but failed again.
• At 23:30:05 the operation of the Broker’s platform got back to normal, while the price of the financial instrument BTCUSD had risen beyond Take Profit level set by the Client initially (@24248.43).
• The Client’s Long position #75210080 was closed by the Broker via Take Profit order, as per
Client’s initial instructions.
• At 23:55:25 Short position #75211034 was established on the Client’s account (@24406.44).
On August 13, 2022, the price of the financial instrument BTCUSD had risen above the price level @24800.
More than 3 weeks after the incident, i. e. on 07.09.2022 the Broker acknowledged the technical issues faced by the Client on August 12, 2022, and asked the Client to accept execution of the Take Profit order by 24300.51 and additional profits in the amount of 287.39 USD, however, rejected the Client’s demands for additional compensation, since in their opinion the disputed position # 75210080 was closed correctly, as per Client’s instructions specified in his Take Profit order.
The Client does not agree with the Broker’s decision (see below), does not accept the Broker’s offer for compensation in the amount of 287.39 USD, accuses the Broker of misconduct, as well as in connection of their delayed response. In the Client’s opinion the fair solution to the dispute would be a compensation in the amount of 4000 USD, instead of 694.52 USD (407.24 + 287.39) profit offered by the Broker. The Client believes that in case of stable operation of the Broker’s platform in the period of the incident the said amount of profits could have been easily guaranteed.
In connection with the above, the Client requests the Dispute Resolution Committee to check the
correctness of the Broker’s actions in the period of the incident, as well as bind the Broker to offer the Client additional compensation for unrealized profits (4000 USD). The Client provided the investigation with the screenshots of the Broker’s platform in the period of the incident and the response of their Customer Support regarding the incident, as well as the Broker’s official response on this complaint, as documentary evidence.
In turn, the Broker does not see any grounds for the Client’s complaint, since in their opinion the compensation offered to the Client is adequate, as it was calculated at actual market prices available in the period of the incident and in full compliance with the provisions of the regulatory documents and trading rules established by the Company. The Broker provided investigation with the history of trading operations performed by the Client, as well as the server log records, as documentary evidence.
| Complainant | Broker | |||
| XXX | YYY | |||
| The Financials Commissions Complaint | #ZZZ | |||
| Complaint Raising Date | Complaint Filing Date | |||
| 12/08/2022 | 07/09/2022 | |||
| Complaint Response:The decision on this complaint is based on the information provided by the brokerage company XXX and The Client.After a comprehensive analysis of the documentary evidence provided by the Client and the Broker the Dispute Resolution Committee of the The Financials Commissions has come to the following conclusions:First of all, it should be noted that according to the information provided by the Broker:a) On 12.08.2022 at 21:16:40 GMT the Client placed his limit Take Profit order at 24248.43 BID price level which secured him 407.24 USD of profit. The profit was duly credited to the Client’s account; therefore, in the Broker’s opinion, the disputed position # 75210080 was not closed by an error but on the contrary according to set instruction of the Client.b) The Client was duly and most importantly timely informed about the technical problems on the platform and difficulties clients could face. According to the logs of the system the Client tried to set the “Take Profit” to the claimed level of 24771.94 at 23:29:07 GMT, what is 24 minutes after he was well informed about the technical situation on the platform.c) The Broker believes that the Client accepted and assumed the risk and consequences of technical failure of the platform. In support of their position the Broker refers to their regulatory documents:Risk Warning“…Clients undertake transactions on any electronic system, they will be exposed to risks associated with electronic systems, which include the failure of hardware, software, servers… The result of any such failure may be that a Client’s order is either not executed according to his/her instructions or is not executed at all.”Agreement for international financial services4.10. The Company shall bear no responsibility for any circumstantial, special, accidental and penalty losses of the Client including (but not Limited) any lost profits, the loss of any expected savings or the loss of a profit in case the Client was informed by the Company about the possibility of such losses. Moral damage is not subject to any compensation.d) The Company does not admit any of the allegations of or liability towards the Client but as an exception and as a gesture of a goodwill on 07.09.2022 the Company has asked the Client to accept execution of the order by 24300.51 and extra profit in the amount of 287.39 USD. The reason for this particular amount is that the Client attempted to make this modification of the order and the price would have reached that level during the period of difficulties.Second, according to the information provided by the Client (the screenshot of conversation between the Client and Customer Support taken from live chat), on the day of the incident the Broker indeed had acknowledged the issue faced by the Client but could not help him with changing the parameters of pending Take Profit order. Their advice to the Client was as follows:“In this case it remains to wait for the system operation to be reinstated.”Third, in the common opinion of the DRC experts, it is necessary to divide the incident occurred on the Client’s trading account into two separate events:The first event is a technical failure of the platform due to which the Client could not change the parameters of his pending Take Profit order attached to the disputed position # 75210080. In the period from 23:13:44 to 23:29:07 (12.08.2022) the Client made many attempts to do that but failed due to system failure.The second event is related to trading operations which the Client performed after technical failure of the platform. When the operation of the Broker’s platform got back to normal the Long position # 75210080 was closed with profits and the Client opened new Short positions ## 75211034, 75211462, 75211843, 75212128 in the period from 23:55:25 (12.08.2022) to 01:03:37 (13.08.2022).Fourth, when assessing the amount of compensation offered by the Broker, the experts of the DRC took into consideration the following:a) Initially the Client had indicated his intentions toward the disputed position # 75210080 as follows: closing position via Take Profit order at 24248.43 price level.b) Between 22:40 and 22:45 the BID price of the financial instrument BTCUSD reached the 24237 price level, as confirmed by the price dynamics of the said instrument in the MT4 platform offered by the Broker.c) As such, since the Client’s Take Profit order was not filled, at 22:45:03-22:45:31 (that is, before the Broker informed the Client about the platform’s malfunction), following the price advance, the Client changed his intentions toward the disputed position # 75210080 as follows: making attempts to change the parameters of the pending Take Profit order from 24248.43 to 24800.d) In the next couple hours before the full recovery of the platform’s operations the Client made several additional attempts to change the parameters of his pending Take Profit order (@24800>@24300.51>@24300.2>@24400.7>@24363.92>@24364.46>@24410.62>@24410.09> @24385.54>@24386.29>@24386.69>@24403.01>@24399.7>@24400>@24792.88>@24771.94), thereby introducing uncertainty into his intentions towards the price level where the disputed position should have been closed.e) Thus, in the general opinion of the DRC experts, the only reliable indicator of the true intentions of the Client in relation to the disputed position # 75210080 could be considered the actions taken by the Client after the restoration of the platform operation, namely the opening of new Short positions ## 75211034, 75211462, 75211843, 75212128, from the 24406.44 price level or higher.Summarizing all the above, the members of the DRC determined the following:a) The members of the DRC admitted that due to the system failure on the Broker’s side the Client’s trading plans were disrupted and this event had negative consequences on the Client’s psychological state.b) The negative aspect of the whole situation is the fact that the Broker does not have clearly defined provisions of the Client Agreement regulating the measures and deadlines of response to the consequences of technical incidents on their side not to mention the fact of their inability to transfer the Client’s request to the Dealing Department.c) In this regard it should be noted that The Financials Commissions is committed to the best business practices accepted throughout the industry which assume that, if there is some issue caused by the broker, there shall be minimum impact on the client, and some solutions shall be provided in a swift manner to mitigate negative effects of it on the client’s positions.d) The Broker is ready to partially compensate the Client for unrealized profits, which could have been secured under normal operation of the Broker’s platform. Nevertheless, in the general opinion of DRC experts, the compensation amount offered to the Client were deemed as not enough.As such, taking into account the circumstances of the incident, the DRC has made a compromise decision, according to which the Broker must offer the Client additional compensation of unrealized profits on position # 75210080, calculated at best possible price (24406.44) at which the Client might have closed his position. The amount of additional compensation is calculated as follows:667 * 200 * (24406.44/24174.63 – 1) – 407.24 = 871.93 USDThis complaint was reviewed by the members of the Dispute Resolution Committee of the The Financials Commissions and was processed by the Head of the Committee. | ||||
| Ruled in Favor | Compensation | |||
| Client | 871.93 USD | |||
| If you have any questions regarding this investigation, please send them to the following address info@financialscommissions.com | ||||
| Acknowledgement | ||||
| I certify that all information was considered by the Dispute Resolution Committee of the The Financials Commissions and hereby confirm that the decision was made fairly, impartially and without interference. I am confident that the information provided in the document is true. | ||||
| Signature | Designation | Date | ||
| Anatoly Bulanov | Head of DRC | 15/10/2022 | ||