Gain Capital has acquired the retail FX customer accounts of Capital Market Services in the US, Bermuda, UK and Japan, and has already begun moving them to its retail site, Forex.com, the company officially announced this week.
Transfer of CMS’ US and Bermuda customers was completed on October 15; transfer of UK and Japanese customers is expected to be completed over the next few weeks.
The official announcement came as little surprise to US customers, who were told about the acquisition back on October 10.
Interestingly, in a footnote to the official statement from Gain, it says: “Since its inception, CMS has identified traders’ needs and built its core trading platform, VT Trader, to accommodate its loyal client base”. Why praise CMS technology when the newly transferred clients will be stuck with the choice of MetaTrader4 or the Forex.com platform? And isn’t that adding insult to injury for those who deliberately chose CMS over other brokers? Not everyone is happy – disgruntled CMS customers are venting their ire online in retail chatrooms.
This is the second acquisition by Gain this year. On September 13 it announced it had acquired over 4,000 customer accounts from MG Financial when MG decided get out of FX.
Gain says the two buys “highlight Gain’s strategy of pursuing attractive acquisition and alliance opportunities.” And probably helps bolster the IPO that Gain filed last year.
CMS will no longer provide retail FX services but it will continue to offer liquidity services to institutional clients and act as an introducing broker for Forex.com. We wondered why they decided to keep on the institutional clients until we realised that institutional clients probably need far less babysitting and therefore a smaller customer service team.
This could well be the right move financially for CMS, which is not a large player in the US; the new capital requirements will squeeze everyone hard. Even so, it looks like customers were not high on CMS’ and Gain’s list of priorities, even if there is a ‘Welcome CMS customers’ banner at the top of the Forex.com site.
Glenn Stevens, CEO of Gain Capital, says: “Our goal is to provide these traders with uninterrupted service, and we will work closely with CMS’ team to ensure a smooth transition of their customer’s accounts and assets to our retail division, Forex.com. We are confident that CMS’ customers will be satisfied with the robust offering available at Forex.com, including our industry leading trading tools, research and educational resources, as well as our focus on providing superior customer service.”
CMS are unable at this time to disclose the number of retail accounts transferring to Forex.com.