After the SNB Black Swan event back in 2015 few brokers went under, see Alpari UK and many other Brokers got into financial problems because of improper risk management infrastructure (see FXCM).
Due to the lack of liquidity, and algos no stepping in to take the other side of retail traders during that time, combined with insane usage of leverage many retail traders saw their account balance going negative in the tens of thousands of $$$. But many brokers forgive their clients because many are bucket shop Brokers and can make the market out of thin air🙂 so they basically could honor the SL, because you werant trading in the real interbank market. While other use A-B books and hedge their entire book so they where safe.
However, I know that IG went after their clients with the negative balance but they backed off once the clients organised themselves and sued IG. It's not that easy for the Broker to just come after you if you go in the red, they have to assume certain risk...
just my 2c
Regards.
