Is FoundersXTrade regulated? Yes, by three federal bodies.
FoundersXTrade operates through a broker-dealer that has been federally registered for over two decades. Here is exactly which regulators apply and how you can verify each one.
Regulatory bodies
Securities and Exchange Commission (SEC)
The SEC oversees securities markets, protects investors, and enforces federal securities laws. Founders Financial Securities LLC has been SEC-registered since 2006.
Verify on SEC EDGARFinancial Industry Regulatory Authority (FINRA)
FINRA oversees broker-dealers and their registered representatives, enforcing rules for fair dealing and market integrity. All licensed professionals at the firm are subject to FINRA examination and continuing education requirements.
Verify on BrokerCheckSecurities Investor Protection Corporation (SIPC)
SIPC protects customers of failed broker-dealers. Eligible accounts at Axos Clearing LLC are covered up to $500,000 per customer, including up to $250,000 for cash claims. This covers broker insolvency, not market losses.
SIPC member directoryHow SEC Rule 15c3-3 protects you
SEC Rule 15c3-3, called the Customer Protection Rule, requires broker-dealers to keep customer securities separate from their own money. Axos Clearing LLC performs this calculation daily and holds customer funds in a dedicated reserve bank account backed by cash or U.S. Treasury securities.
In plain terms: your stocks, ETFs, and options contracts are never on our balance sheet. They sit in segregated accounts at the clearing firm. If FoundersXTrade shut down tomorrow, your portfolio stays at Axos Clearing and can be transferred to any other U.S. broker.
Common questions about regulation
Which regulators oversee FoundersXTrade?
FoundersXTrade operates through Founders Financial Securities LLC, which is registered with the U.S. Securities and Exchange Commission (SEC) as both a broker-dealer and investment adviser, and is a member of the Financial Industry Regulatory Authority (FINRA). Customer accounts are additionally protected through the Securities Investor Protection Corporation (SIPC).
What is the difference between SEC, FINRA, and SIPC?
The SEC is the federal government agency that regulates securities markets. FINRA is the self-regulatory organization that oversees broker-dealers and their registered representatives. SIPC provides insurance-like protection for customer securities accounts if a broker-dealer fails financially. All three apply to FoundersXTrade.
Does FoundersXTrade follow the Customer Protection Rule?
Yes. Under SEC Rule 15c3-3, Axos Clearing LLC (our clearing custodian) maintains strict segregation of customer assets from firm assets. This means customer securities and cash are held in dedicated reserve accounts, separate from any operational funds.
What happens to my assets if FoundersXTrade closes?
Customer securities are held in custody by Axos Clearing LLC, not by FoundersXTrade. If FoundersXTrade ceases operations, your securities remain at the clearing firm and can be transferred to another broker. SIPC additionally protects eligible accounts up to $500,000.
Is FoundersXTrade registered in all 50 U.S. states?
Founders Financial Securities LLC holds registrations across multiple U.S. states and jurisdictions. You can verify the specific state registrations through the FINRA BrokerCheck report for CRD# 137945.