Forex group Forex Capital Markets (NASDAQ:FXCM) said on Tuesday it will change the name of the holding company FXCM Inc. to Global Brokerage Inc. As part of the on-going changes, the company’s ticker on the NASDAQ Global Market will change to GLBR from FXCM and the management will undergo major switch.
The changes aim “to avoid any possible confusion among customers or others”.
The new name and ticker are expected to be effective at the opening of trading on 27 February, 2017. The broker’s new CUSIP number will be 37891B109.
Drew Niv has submitted his resignation from his positions serving as CEO of FXCM Inc. and FXCM Group, effective upon the selection and appointment of a successor. He has also resigned as a director of the two companies and chairman of the board of FXCM Inc., effective immediately. In addition, William Ahdout has also stepped down as a director of the board of directors of FXCM Group.
“At this time all parties have decided that it is in the best interests of the Company for Mr. Niv and Mr. Ahdout to resign from The Board of Directors,” FXCM said in a statement. “Company feels it is important for Mr. Niv to stay in his position during this transition period and to serve as an advisor to the newly appointed successor to assure an orderly transition.”
Meanwhile, Bryan I. Reyhani will assume the position of chairman of the board of FXCM Inc., while Brendan Callan and Jimmy Hallac have been appointed as interim CEO and chairman of the board of FXCM Group, respectively.
Callan has been in the FXCM group since 2001 and has been promoted from his previous position as CEO and president of the group’s European operations. Hallac, on the other hand, is a managing director of US lender Leucadia National Corporation, which holds a significant interest in FXCM Group.
As a result of the new appointments, FXCM Group’s new board of directors consists of the following six members:
- Jimmy Hallac, managing director of Leucadia
- Rich Handler, CEO of Leucadia
- Brian Friedman, President of Leucadia
- David Sakhai, COO of Global Brokerage
- Robert Lande, CFO of Global Brokerage
- Kenneth Grossman, managing director of Global Brokerage
“We are very excited to have Brendan and Jimmy in their new roles. We believe that, under their leadership, FXCM Group will be able to continue to enhance and grow its global platform and customer offering,” Leucadia’s Messrs. Handler and Friedman said in a statement. “Brendan and Jimmy share our deep commitment to always putting clients first, maintaining and building a culture of transparency, communication and support among employees, and responding to the needs and goals of all relevant constituencies, including FXCM’s customers, employees, regulators, business partners and equity owners.”
The renaming and management changes come as a response to the issues FXCM has been facing in the past weeks. The broker was forced to exit the US and to sell its clients there to peer Gain Capital.
Earlier in February, FXCM announced its local arm got banned by the US National Futures Association (NFA) and agreed to withdraw from registration with the US Commodity Futures Trading Commission (CFTC) and never to seek to register with it. The company was charged with taking positions against customers, concealing that a key market maker was tightly related to the broker, and misrepresenting its “No Dealing Desk” platform as providing no conflict of interest with customers.
In addition, FXCM was fined by the CFTC $650,000 in relation to its US subsidiary’s undercapitalization at the time of the Swiss Franc (CHF) related crisis from January 2015.
FXCM Group operates via several subsidiaries – Forex Capital Markets LLC (which until recently was regulated in the US), UK-licensed Forex Capital Markets Ltd., and Australia-regulated FXCM Australia Pty. Ltd. It is 50.1% majority owned by FXCM Inc. The rest of the group moved in 2016 to the hands of Leucadia, from which the broker drew a $300 million loan to offset the hardship it faced after the CHF-related crisis.