What Happened to MyForexFunds: The 2023 Collapse Explained

MyForexFunds was a Canadian-incorporated prop firm that grew aggressively from 2020 through mid-2023. By the time of regulatory action, it was widely cited as one of the largest prop firms by trader count, alongside FTMO and a handful of others. The pitch was familiar: pay an evaluation fee, prove your skill, get a funded account, keep up to 80 to 90 percent of profits.

Account sizes ranged from $5,000 up to $300,000+. Trading happened on a MetaTrader-based stack with custom rule enforcement on top. The firm was prolific on YouTube and prop firm review communities. For a period, it was the default first-choice prop firm for new retail traders entering the funded-account space.

That popularity is part of why the collapse hit so hard. A lot of traders had real money tied up.

On August 29, 2023, the US Commodity Futures Trading Commission filed a civil enforcement complaint in the US District Court for the Eastern District of Pennsylvania against MyForexFunds and its founder, Murtuza ("Mike") Kazmi.

The action was filed simultaneously with a parallel action by the Ontario Securities Commission in Canada, where MyForexFunds was incorporated.

That same day, the court issued a statutory restraining order. Operations effectively halted. The firm's trading platform stopped accepting new evaluations and existing funded traders lost access to withdrawals while the case proceeded.

The CFTC's complaint, which is publicly available on the agency's website, made three core allegations against MyForexFunds and Kazmi.

• Operating as an unregistered futures commission merchant. The CFTC alleged the firm took customer funds in connection with retail commodity transactions without the registration required to do so legally in the US.
• Misrepresenting how trades were executed. Specifically, the regulator alleged customers were told their trades were placed in real markets, when (in the CFTC's view) many were managed internally in a way that put MyForexFunds in a position counter to its customers' interests.
• Use of customer funds for non-customer purposes. The complaint alleged a substantial portion of trader fees were used by Kazmi personally rather than held for the operations described to clients.

These are allegations from the CFTC complaint. Defendants are presumed not liable until adjudicated. Subsequent settlements and consent orders are public record on the CFTC website.

From the trader perspective, the timeline was brutal.

• Evaluation fees paid in the months before the action were tied up in receivership. Most traders eventually received partial recovery through the court-administered process, but it took many months and was less than the original fee in most reported cases.
• Funded accounts were frozen. Pending payout requests stopped processing. Traders who had built funded balances over months or years lost access to those balances.
• Mid-evaluation traders lost progress. Anyone partway through Phase 1 or Phase 2 had no way to complete the challenge after the freeze.

The lesson is unambiguous: a prop firm account is not your account. The capital you trade is the firm's, and your access to it depends on the firm continuing to operate. When the firm stops, your account stops with it.

The MyForexFunds collapse wasn't unforeseeable. The patterns showed up before the action. Here's the due diligence checklist I run before sending a dollar to any prop firm.

• Years of continuous operation under the same legal entity. Three to five plus years is meaningful. Sub-12 months is risky. Brand resurrections under new entities don't count as continuity.
• Payout track record verified by community. Forex Factory, Trustpilot, and dedicated prop firm forums collect real payout reports. Read 50 to 100 of them, not just the top reviews.
• Regulatory posture. Some firms operate from jurisdictions with stricter financial regulation, others from looser ones. Neither is automatically good or bad, but it matters how the firm has handled prior regulatory inquiries.
• Marketing tone. Heavy use of "guaranteed funding," lifestyle imagery, and influencer partnerships correlates with worse operational discipline. Boring, technical, rule-focused marketing correlates with better.
• Founder transparency. Real names, real backgrounds, real interviews. If you can't find out who actually runs the firm in five minutes of searching, that's a flag.
• Client fund segregation. Look for explicit statements about how client funds are held. Brokers (where the actual trading happens for the firm) ideally hold funds in segregated accounts under regulator oversight.

None of this guarantees safety. It does meaningfully reduce the chance of getting caught in the next collapse.

For traders looking at the prop firm space today, the firms with the longest continuous operating records (under the same legal entity, no regulatory restructure) are FTMO and The5ers.

• FTMO. Founded 2014. Czech Republic-based. The household name in prop trading and the largest by brand recognition. Long verifiable payout history.
• The5ers. Founded 2016. Same continuous operation under same ownership. Cheapest entry plan in the industry (Hyper-Growth at around $39). My personal main funded account, with $64K+ in verified payouts.

Both have weathered multiple market cycles, regulatory environments, and competitor collapses without operational disruption. That's the bar for "established."

The full side-by-side is in FTMO vs The5ers. The framework to actually pass either of them is in how to pass The5ers $100K High Stakes. And if you want me to walk you through real setups during NY session, that's what the mentorship Discord is for.