CFTC

The Commodity Futures Trading Commission is the United States federal agency regulating derivatives markets, and it is the reason the list of brokers Americans may legally use is so short. Retail off-exchange forex falls under its jurisdiction through the Commodity Exchange Act, and a firm acting as counterparty to US retail clients must register as a Retail Foreign Exchange Dealer or as a Futures Commission Merchant.

Why the list is short

The barriers are deliberate and expensive. An RFED must maintain adjusted net capital of at least $20 million plus a percentage of client liabilities — an order of magnitude above what any other jurisdiction demands. It must report financial condition monthly, submit to audits, and hold client funds in accounts at approved depositories.

On top of capital, the CFTC's rules reshape how trading works. Leverage is capped at 50:1 on major currency pairs and 20:1 on all others. Hedging — holding long and short positions in the same pair simultaneously — is prohibited, and orders are closed on a first-in-first-out basis. A strategy that relies on opposing positions in one instrument cannot be expressed on a US account and has to be restructured rather than ported.

What clients get in return

Client money must be held apart from the dealer's operating funds at approved institutions, and the CFTC publishes each RFED's financial data monthly — capital levels and client asset totals, firm by firm, in public. No other jurisdiction on this site provides that.

What it does not provide is a compensation scheme. Retail forex is not covered by SIPC, and a dealer's failure leaves clients as creditors. The protection is preventive: capital high enough that failure is rare, and disclosure detailed enough that deterioration is visible in advance.

Solicitation of US residents

An unregistered firm may not solicit US retail clients, and the CFTC brings enforcement actions against those that do. A broker advertising that it accepts Americans without appearing on the register is not offering a loophole — it is operating unlawfully, and a client's recourse in a dispute is close to nil.

Verifying registration

Check the National Futures Association's BASIC database, which shows registration status, category and full regulatory history including disciplinary actions. ProForexBrokers.com treats the absence of an entry as decisive for any broker claiming to serve US clients.