Canadian traders blocked from CFDs set up US accounts to get around the ban. This involves lying on federal documents, committing mail fraud, and possible Patriot Act violations. The combination of addiction and prohibition leads traders to justify committing felonies.
Cross-border banking starts the scheme. TD and RBC’s US branches make opening American accounts seem legitimate. Canadians drive to Buffalo or Seattle, use friends’ addresses or mail forwarding services, and claim US residency. Bank employees know what’s happening, and collect new account commissions.
Online CFD trading platforms accepting US clients don’t verify as strictly as European ones. Social security number or ITIN becomes golden ticket. Canadians acquire ITINs through creative IRS regulation interpretations. It is technically arguable but in reality, it is fraud.
Border town mailbox businesses profit from Canadian traders. Hundreds of Canadians “live” at Bellingham or Plattsburgh UPS Stores, never spending a night in the US. These addresses appear on bank documents, brokerage applications, and tax forms. Store owners know it’s fraud, but monthly rentals make up for their complicity.
Canadians with old work visas or dual citizenship use expired US credentials. Haven’t lived in America for decades but maintain accounts for trading. When the IRS discovers someone claiming no US income with massive trading volumes, penalties destroy lives.
Credit card strategy involves getting US cards using cross-border credit history. Amex and Capital One issue cards to Canadians with US addresses. Fund CFD accounts without Canadian bank alerts. 22% interest plus cash advance fees mean losing before trading starts.
Family members unknowingly enable fraud. “Just need your address for an investment account” turns into a wire fraud conspiracy when investigators trace millions in trading losses to grandma’s Florida condo. Relatives had no idea they were facilitating CFD trading.
State regulatory differences add complexity. Some platforms accept New York residents, others don’t. Canadians research friendliest states, establish fake residencies. Become Delaware corporate law experts while knowing nothing about trading.
Tax nightmares multiply. IRS wants taxes on “US residents” worldwide income. CRA taxes Canadian residents. Treaties don’t cover fraudulent residency. Owe both countries taxes on the same losses.
Money laundering red flags obvious. Funds flow from Canada to the US to offshore back to the US then Canada. Every transfer loses 2-3%. Banks file suspicious activity reports. Enforcement agencies have bigger fish to fry than gambling addicts.
Online CFD trading companies know exactly what’s happening but design systems to dodge responsibility. Address verification checks formatting, not whether addresses are real. When fraud is discovered, platforms claim victim status too.
Fake US businesses justify banking. Delaware LLCs providing “consulting” exist solely for brokerage access. File zero revenue reports while millions flow through. States don’t care if fees are paid.
Pandemic exposed fiction. Couldn’t visit branches for verification or receive mail at fake addresses. Accounts were frozen when everything went remote.
Rich Canadians get private wealth management access to structured products providing CFD exposure. These products typically require million-dollar minimums. The wealthy get what’s banned for others.
Border lawyers help establish US presence for “investments.” Know it’s for banned trading, avoid direct questions. Plausible deniability costs $5,000.
Crypto adds permanent evidence. Buy Bitcoin in Canada, transfer to US exchanges, convert to USD, fund accounts, trade CFDs. The blockchain records everything permanently.
Student visa holders keep accounts after returning to Canada. Trading on an expired visa status violates immigration and financial laws simultaneously.
Family breakdowns reveal wire fraud, tax evasion, identity theft during divorces. Hidden gambling often turns into criminal prosecution.
Infrastructure operates openly. “Cross-border optimization” consultants advertise on Facebook. Everyone knows the real purpose. Authorities could intervene but don’t.
