Forex trading scams

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Most Forex trading takes place in the FX market place, which is different from the futures market, in that the currencies are exchanged in real time when trading. Although in the futures market, the date the trading price is determined and the date on which the currency is exchanged varies. When a holiday maker goes to his bank to exchange money he participates in the FX market. The following Forex market features make it easy to find Forex trading scams and Forex frauds:

No medium trade is regulated.
Funds are traded via computer networks between one and the next trader, often referred to as over-the-counter (OTC).
Forex market is a highly profitable market. This is basically a loan by a trader to a trader that allows the trader to trade at a fixed rate. The average genetic value will be 50: 1, 100: 1 or 200: 1 depending on the amount of money sold. At 100: 1 the trader only needs to set £ 1000 to cover the trade of £ 100,000. The reason why traders offer such high power is because the exchange rate in the Forex market is usually no more than 1% during the trading of any trade. However, even with the slightest variation, the high altitude attracts inexperienced traders who may think that the Forex market is a fast-growing market.

Forex scams

The following list of Forex scams lists the types of scams that have been involved in Forex fraud in the past and in the past.

Trademark sellers

A signal trader scam is a scam operated by a person or company that sells information about what trades should be made and claims that this information is based on proven expert predictions to make money from an inexperienced trader. They usually charge a daily / weekly or monthly fee for this service but do not provide any information that helps the trader make money. They will usually have a lot of evidence from sources that are suspected to be legitimate in order to gain the confidence of the trader but actually do nothing to predict a profitable trade.

High-yield investment plans

HYIP Investment Plans (HYIP) are usually a type of Ponzi scheme in which a high return on small investment in a Forex fund is promised. However, in reality, the original investors are reimbursed for the money received by the current investors and the continuous flow of new investors is needed to keep the funds flowing, if no longer the investors in the system the owners often close. and take all the remaining money.

Deception of bid / bid spread

These types of scams have declined over the years but still exist. This is why it is important to choose a Forex trader registered with a regulatory agency. This type of scam will usually involve a spread of 7-8 pips instead of between 2-3 pips which is normal.

Software scam

Forex robots fraudsters entice beginners with the promise of huge profits with little effort or knowledge. They may use fraudulent or misleading statistics to convince customers to buy their product. Their promises are flawed as no robot can adapt and succeed in all areas and markets. The software is often used by professionals only to analyze past performance and identify trends. All software should be officially and independently tested but caution is required when you trust the update itself as it is free of charge. If their product did what they wanted, they would not sell it but use it only for themselves.

Managed accounts

These accounts can be a form of Forex scam and there are many examples of managed accounts. These scams often involve a trader taking your money and instead investing it, buying it to buy all sorts of luxury items. When the victim finally asks for his money back there is not enough money to return it.

Ponzi and pyramid schemes

These are the most common types of relationship fraud. They promise high returns from a small initial investment. Early investors often get some kind of return on their money and are encouraged by the success they see and then recruit their friends and family into the program. However, the reality is that the ‘investment opportunity’ is non-existent and their initial return is funded by other program members. If investor numbers start to decline then fraudsters close the system and take money.

Boiler room scams

This type of scam involves fraudsters who often get people to buy shares in a private company with the promise that once the company goes public their shares will increase significantly. They rely on the use of “urgency” – suggesting that the opportunity will be lost if they do not act immediately which prevents the intended recipient from researching the opportunity properly. However, usually the company does not really exist and may have a fake phone number, office and website. Once the fraudsters have made all the money they can, they will disappear with everyone’s investment.

What do I do if I have been scammed?

If you have been scammed, Expert advice report the fraud to the appropriate authorities. For the UK visit https://www.fca.org.uk/consumers/report-scam-us.

And to do this is a good idea and to tell your story in the Forex community so that other people do not fall into the same scam.