FX Case Update (December 2017): The FOREX Administration – A View from the Trenches

By Mike Lange, Securities Litigation Counsel, Financial Recovery Technologies

Given how many financial institutions used FOREX as part of their investment strategies – and the breadth of time (2003-2015) and financial instruments involved – we expect this to be one of the most complex antitrust administrations to date.

Now that the claim forms have been out for several weeks, it seems a good time to discuss client challenges we’re seeing and offer some recommendations.

1. Notices

For most clients, notices are being received on a fund-by-fund basis. As a result, larger institutions are getting dozens, hundreds, and in some cases thousands of notices in the mail.  Ensuring you’ve received notices for all affected accounts is important as each contains unique log-in credentials necessary to access the administration portal.

Clients may not receive notices for every account for several reasons. Mailing lists were compiled from customer records provided by the settling defendants; and supplemented with direct notification to brokers, trading firms, and others believed to have affected customers who can either mail notices directly or ask the administrator to do it.  If clients traded FOREX through others – g. used a prime broker, investment manager, ECN, or an exchange – the settling defendants’ records may not contain their name, causing notices to be sent elsewhere.  As in past cases, settling defendant records may be less complete for early years.  Large investors with multiple locations and many employees can find that notices were sent to the wrong locations or wrong persons in the organizations.

FRT Recommendation: You should identify all potentially impacted accounts and reach out to the settlement administrator about those for which you have not received notices and credentials.

2. The Administration Portal

Unlike prior ‘constructed trade’ administrations, when you log onto the FOREX website you will not find any trading data.

At this point, the site only allows you to do limited number things like changing password, updating profile information, changing tax ID and payee instructions, and designating filing Option 1 (relying on constructed trades) or Option 2 (submitting data).

FRT Recommendation: Ensure you understand the impact of the filing option you select. Once selected, your filing option and any data submitted are locked-in and the system does not permit further changes.

3. Filing Strategy

If you elect Option 1 before May 16 (note that the deadline was pushed back from March 22), you may still have to submit any exchange trades. If you elect Option 2, you will need to gather and submit all your trade data ahead of the initial filing deadline.

FRT expects the amount of information for clients who choose filing Option 1 to be very limited and in the nature of year-by-year summaries rather than the line-by-line detail seen in prior matters. This makes it challenging for you to assess whether the administrator has fully captured your eligible trades.  And your decision whether to accept or submit data will have to be made in a compressed time, just 30 days.

FRT Recommendation: Begin gathering your data now and have everything ready before that initial deadline.

4. Filing Assistance

Given these challenges, many clients are choosing to supplement their internal resources with outside help. Consider just the staff time your will need – for hundreds of affected accounts – to identify missing notices; obtain log-in credentials where available; log into the administration site for every account in order to change passwords, check profiles, and update tax IDs and payee instructions, and make your initial filing Option selections.  Add to this the time needed earlier to identify affected accounts; to determine where trading data resides; to obtain it; and to organize, rationalize, clean-up and then map the data to the more than 35 fields in the claim form.  As well as the time to track down and add missing data and once submitted, resolve any deficiencies or challenges from the administrator; and finally to handle remittance, allocation to accounts, and related accounting and reporting.


In summary, our best advice to clients has been to start early, expect challenges, and  leverage your internal resources with outside help.

Learn More

Please don’t hesitate to contact your FRT account representative for more information regarding this matter or email us at learnmore@frtservices.com.

About FRT


Founded in 2008, Financial Recovery Technologies (FRT) is a leading technology-based services firm that helps the investment community identify eligibility, file claims and collect funds made available in securities and other class action settlements. Offering the most comprehensive range of claim filing and monitoring services available, we provide best-in-class eligibility analysis, disbursement auditing and client reporting, and deliver the highest level of accuracy, accountability and transparency available. For more information, go to www.frtservices.com.