Lots to unpack there, but the “favorable” margins and low required funding they offered are illegal to offer precisely because they preferentially attract poor, unsophisticated people and mechanically increase the likelihood of their trades blowing up.

This is why being the counterparts to all your client’s trades and using the public markets only as a source of random numbers to operate a gambling operation with a fig leaf of respectability is derisively referred to as a “bucket shop” and is broadly illegal.