FOREX Fraud, Scams, and Off-ExchangeOptions and Exotics, for information on legitimate, regulated FOREX options trading.) The number of these has decreased dramatically, but a few are still in operation.
These operations are almost never registered with the CFTC, NFA, or any recognized regulatory body.
Tip: A broker-dealer may be unregistered for perfectly sound reasons: it does not wish to participate in U.S. retail business and the regulatory burden of same, or perhaps it promotes a trading system that uses hedging, also against U.S. regulations. The best of these firms will have prime broker agreements and a bullet-proof cash custodian relationship with a major bank. But these firms are on the CFTC radar and may have complaints filed against them if only as a test of regulatory muscle.
By Michael Duane Archer