Forex CT, an Australian retail forex and CFD broker, was ordered by the Federal Court to pay a $20 million penalty for running a system of unconscionable conduct that pressured vulnerable, inexperienced clients into depositing money many of them could not afford to lose.
The judgment, handed down on 2 June 2021, followed civil penalty proceedings brought by the Australian Securities and Investments Commission. Beyond the $20 million penalty against the company, the Court ordered Forex Capital Trading's sole director, Shlomo Yoshai, to pay $400,000 and disqualified him from managing corporations for eight years for breaching his duties and aiding the firm's conduct.
A Business Built to Extract Deposits
Forex CT offered clients contracts for difference and margin foreign exchange contracts that it issued itself. According to the Court, it built a business designed to extract deposits rather than serve clients. Account managers were rewarded for how much money clients put in and lost, not for whether clients did well — a conflicted incentive structure that shaped how the firm treated the people on the other end of the phone.
The conduct was not a failure at the edges of an otherwise sound operation. The Federal Court characterised it as systemic: a sales culture engineered to keep vulnerable, inexperienced clients depositing and trading, with the firm's revenue rising as their balances fell.
The Incentive Structure Is the Tell
This was not a compliance failure at the margins — it was the business model. The Court's $20 million penalty and the eight-year ban on its director were proportionate to that. For anyone choosing a broker, the tell is always the incentive structure. If the people advising you are paid on how much you deposit, they are not on your side, however friendly the call.
ASIC cancelled Forex CT's Australian Financial Services licence in 2020, and the firm no longer operates. But the case remains a reference point for how retail CFD sales conduct is judged in Australia, and for the kind of remuneration arrangements regulators now treat as inherently conflicted.
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What This Means for Retail CFD Traders
Forex CT did not stumble into a $20 million penalty. The Federal Court found a business designed to extract deposits, staffed by people paid on how much clients put in and lost. That is the clearest possible warning about how remuneration shapes behaviour on a trading floor.
The firm is gone and its director is banned for eight years, but the pattern is not unique to one broker. Conflicted incentives are the common thread across the worst retail CFD conduct cases.
Before you deposit, ask how a broker's staff are paid. If the answer ties their income to your deposits and losses, treat every call and every incentive with that in mind.
About the Company
About Forex CT (Forex Capital Trading Pty Ltd)
Regulator
ASIC / Federal Court (Australia)
Action Type
Civil Penalty — Unconscionable Conduct
Penalty
A$20M + A$400k (director)
Status
Licence cancelled; no longer operating
Forex Capital Trading Pty Ltd (Forex CT) was an Australian retail over-the-counter derivatives issuer that offered contracts for difference and margin foreign exchange contracts to retail clients.
ASIC cancelled its Australian Financial Services licence in 2020, and in June 2021 the Federal Court imposed a $20 million penalty for systemic unconscionable conduct and conflicted remuneration. Its sole director was fined $400,000 and disqualified from managing corporations for eight years. The firm no longer operates.
Editor's note & source: Factual points are drawn from ASIC's media release and the Federal Court judgment. This article is not legal advice. Last updated: 23 July 2026.