Prop Trading Drama: FPFX Tech's Bold Move After Internal Audit

FPFX Technologies, LLC (FPFX Tech), a retail prop trading tech provider, has officially severed ties with prop firm Funded Engineer following the completion of an internal audit.

According to FPFX Technologies, the audit revealed what they allege to be an extensive scheme orchestrated by Funded Engineer to deceive both FPFX Tech and the public. This deceptive plan involved inflating payout figures through various illicit activities, as reported by FinanceFeeds.

The investigation brought to light numerous fraudulent actions conducted by Funded Engineer. These actions included the creation of fictitious trading accounts, sidestepping Anti-Money Laundering (AML) and Know Your Customer (KYC) protocols, engaging in wash trading, and generating fictitious payouts. These deceptive activities aimed to exaggerate the firm's payment activities, thereby misleading both traders and FPFX Tech.

The audit disclosed specific findings, indicating that Funded Engineer manually fabricated seemingly fake user profiles within their administrative portal. These profiles, lacking any payment history or billing details, were directly provided with funded accounts, bypassing the firm's standard requirement for traders to complete a challenge before obtaining such accounts.

Further transgressions involved the manual override of AML/KYC checks, permitting these individuals to be approved for funded accounts without the usual due diligence. Additionally, personnel from Funded Engineer were found to have engaged in wash trading, a practice that lacks economic substance but creates misleading activity, purely to inflate the firm's payout statistics.

The audit also revealed that despite approving payouts in the system, Funded Engineer did not disburse any funds to these fictitious accounts. Instead, the prop firm purportedly simulated payments through cryptocurrency wallets and global payroll services without corresponding blockchain transactions.

The investigation concluded that Funded Engineer had overstated its payouts by over $2 million, a claim publicly promoted by one of its founders, Tristian Talbot, on social media.

The CEO of FPFX Tech, Justin Hertzberg, expressed disappointment and conveyed that it is disheartening to witness a firm like Funded Engineer engaging in activities that seem to defraud FPFX Tech. Hertzberg highlighted the crucial role FPFX Tech played in Funded Engineer's ascent within the prop space and emphasized that misrepresenting material facts to traders seeking trading opportunities is unacceptable. He underscored the importance of good actors and ethical practices prevailing to ensure the growth and survival of the prop trading industry. Furthermore, he asserted that FPFX Tech will continue to fulfill its role in ensuring that licensees of their technology conduct themselves accordingly.

In response to these revelations, FPFX Tech intends to file complaints with regulatory authorities and inform other vendors who may be affected by Funded Engineer's actions, considering their independent AML/KYC obligations.

Funded Engineer, headquartered in the United Arab Emirates and led by CEO Tristian Talbot for the past five years, offers account sizes ranging from $6,000 to $300,000. The prop firm provides both 1-step and 2-step evaluation challenges to accommodate various trading strategies, with specific profit targets and drawdown limits outlined on its website.