Numerous FX Brokers Shutter After Suffering “Significant Losses” Following SNB Stunner

Update: 2 more FX brokers have just gone belly up, UK-based Calpari and New Zealand’s Excel Markets.

From Alpari’s statement:

The recent move on the Swiss franc caused by the Swiss National Bank’s unexpected policy reversal of capping the Swiss franc against the euro has resulted in exceptional volatility and extreme lack of liquidity.  This has resulted in the majority of clients sustaining losses which has exceeded their account equity. Where a client cannot cover this loss, it is passed on to us. This has forced Alpari (UK) Limited to confirm today, 16/01/15, that it has entered into insolvency. Retail client funds continue to be segregated in accordance with FCA rules.

This is what Alpari’s CEO, James Hughes, who dubbed the SNB move as “horribly irresponsible”, for obvious reasons now, said:

“I’m sure this isn’t the last we’ll hear on the subject and the SNB are going to be heavily scrutinised in the coming weeks for what appears to be a horribly irresponsible move on their part. For years central banks have tried to avoid days like today by being transparent and making moves like this over time while drip feeding their intentions to the markets. The SNB have shown themselves to be amateurs today and there is many people that will suffer considerably as a result.”

And  here is New Zealand brokerage Excel Markets confirming it too would not continue operations.  “The majority of clients in a franc position were on the losing side and sustained losses amounting to far greater than their account equity. When a client cannot cover their losses it is passed on to us.”

More…