On September 1, 2023, My Forex Funds shocked the prop trading world by announcing that their assets had been frozen by financial regulators in the US and Canada. This effectively shut down MFF and locked their prop traders out of their accounts, at least for the time being.
MFF initially responded with hopes that a hearing on the matter, scheduled for September 11 in the US and soon thereafter in Canada, would clear them to resume operations.
However, after the Commodities Futures Trading Commission (CFTC) released a full explanation of the charges against MFF, I think it is very unlikely they’ll reopen any time soon, if ever.
An opinion issued by the judge in November spelled out even more bad news for MFF (and for most US-based prop firms).
However, MFF is fighting back, especially after it was revealed that the CFTC may have withheld relevant information, or perhaps even outright lied, regarding alleged payments made to MFF CEO Murtuza Kazmi’s personal account.

Table of Contents
Why was My Forex Funds shut down?
The CFTC closed MFF’s accounts due to their allegation that MFF was defrauding its clients by actively trying to prevent them from becoming funded traders, while promising the opposite.
While MFF stated that they made money when their traders made money, they actually made far more money by collecting trader sign up fees and then failing those traders during the evaluation stages or making it extremely difficult for them to be successful.
The CFTC alleges that MFF worked against their traders in a number of different ways including charging undisclosed commissions, manipulating market conditions, executing trades at prices different than what their traders saw, and closing accounts for unfounded reasons.
Indeed, MFF was essentially betting against their traders in almost every trade by acting as the counterparty rather than as a liquidity provider.
Furthermore, MFF is accused of unregistered trading in Canada, as well as the illegal distribution of securities. And the CFTC charged MFF with fraudulently soliciting customers to make leveraged forex and commodity trades, “in clear violation of the law,” according to Director of Enforcement Ian McGinley.
My Forex Funds allegedly took in more than $310 million in fees and had more than 135,000 customers since its inception in 2021. Some of that money ended up in the private accounts of CEO Murtuza Kazmi, who allegedly spent it on luxury cars and mansions, as one does, although Kazmi has proven that much of the personal money transfers were to pay his taxes.
What happens to clients of My Forex Funds? Will I get my money back?
Hopefully. The CFTC is seeking “restitution to defrauded investors” and “disgorgement of ill-gotten gains.” This will, however, probably be a pretty long process. There is also the possibility that MFF returns in some form, in which case it would be up to them how to handle refunds.
What does this mean for other prop trading firms?
That’s a hard question to answer so quickly, but at the very least we can say goodbye to the days in which prop firms operated completely off-radar. For the time being only MFF is directly affected, but clearly, at least in North America, regulators have started looking closely at prop trading firms.
The question is, then, which prop trading firms will hold up under this scrutiny?
MFF was one of the few prop trading firms in the US/Canada that acted as their own broker, and indeed a lot of the charges are related to that fact. This would suggest that prop firms that use third-party brokers would be less likely to draw the eyes of regulators.
However, the CFTC also accused MFF of soliciting customers to make leveraged forex trades without being a registered broker/dealer, which could pose a problem for the industry as a whole. Prop trading firms have always operated in a gray, unregulated area in which they claim to be financial education companies or hide under the umbrella of proprietary trading firms who are simply trading their own funds.
If the CFTC begins treating all prop firms as broker/dealers, they will all be subject to far more regulation and the prop trading world will be forever changed.
That’s not to say changed for the worse, necessarily. Some of the charges levied against MFF, such as canceling customer accounts without pretext, or manipulating prices, have also been directed at other prop firms and with good reason. Clearly these practices have to end, so maybe a little more regulation of prop firms would be a good thing.
It is also worth noting that a number of popular, reputable prop trading firms, such as the 5%ers, for example, are based in countries where regulatory interference is far less likely. US regulators would not be able to seize their assets or make them cease operations, although they could possibly prevent Americans from signing up.
There is still a lot of uncertainty surrounding the future of prop firms, but the reputable firms all knew the day of further scrutiny and regulation was coming and have prepared accordingly. For these firms there might be some roadbumps as they navigate a new regulatory landscape, but ultimately their business should remain largely unaffected.
What’s next for MFF? September 2024 update
Hard to believe it has been more than a year since I originally wrote this, but the case is still wondering it’s way through the court system. I posted a more detailed case update here, but here’s the quick version:
The CFTC made a grave error in their initial filings against MFF. They successfully argued that all of MFF’s assets should be frozen because CEO Murtuza Kazmi was transferring MFF funds to his own account. He was not. Those transfers were tax payments. MFF believes that the CFTC knew the truth, but lied about the transfers anyway.
As a result, MFF has filed both a motion for sanctions against the CFTC and a motion to dismiss all charges. The motion for sanctions will be heard by the judge starting September 19th, 2024.
Stay tuned…
I’m staying on top of this case like no other. Check out my Twitter feed for the very latest, and I’ll also update the site. There is a lot at stake here, not just for MFF’s many clients whose money was frozen, but also for the prop trading firm industry as a whole.
Proszę o informację w sprawie mff mam tam dwa konta i potrzebuje odzyskać pieniadze
Przykro mi to słyszeć. Wszystkie aktywa WRF zostały zamrożone przez CFTC, dlatego WRF nie mogą obecnie przyznać żadnych zwrotów. WRF walczą z tą sprawą w sądzie, ale prawdopodobnie upłynie dużo czasu, zanim zostanie osiągnięte jakiekolwiek rozstrzygnięcie. — Michael (Using Google Translate)