The scams that occur when investing with Forex brokers can be is very difficult to detect, but they happen on a daily basis.
Usually, the victims of a Forex scam are new investors, who have never traded before in CFD’s and the Forex markets.
The Forex Scam Works Like This:
- Fake companies will open a website, that looks like a legitimate Forex brokerage firm.
- They will users terms like “Safe & Secure” but fail to show a valid license.
- You receive a phone call from a broker, who offers you a “Managed Account” or PAMM, with steady returns.
- After your initial deposit of $200, they will start pressuring you to deposit $5,000.
Below are reviews of many CFD & Forex Brokers, however, you should first start with a demo account.
Getting Started With Forex Investing
The smart and best way to start trading, is with a legitimate regulated broker that offers you a free demo account. These brokers are among the largest and most reputable in the online trading industry.
How to Prevent Becoming a Scam Victim
The first step to avoid an investing scam, is to properly research the CFD Forex broker. Some review websites only give generic info, but miss out on these important questions.
- Does the broker hold a valid license from your local governments financial regulator? Like FCA United Kingdom, FSB South Africa or Australia ASIC.
- Is the senior broker (salesman) always calling for you to deposit more money?
- Does the brokers license offer coverage and protection to investors in your country?
- Can I withdraw my money as easily as you let me deposit it?
The second step is to watch out for fake “Copy Trading” software.
- Never use an automated trading software, before you can test out its functions.
- Do not believe any testimonials, because they are all fake and usually illegal.
- Remember, if a software or person opened your trading account, they have full access to your account.
- Most Important! Historical results are never an indicator of future profits.
Forex scams are one of the oldest scams in the history of the world, and the internet has only helped the scammers. With the growing popularity of Ethereum and Bitcoin, there has been a surge in complaints about rouge Forex brokers.
Make sure to properly do your research, and don’t think you can make $500 a day, by doing nothing. For every Forex broker you find, and every trading system you hear about, there are 50 others which offer the identical product.
When choosing a CFD or Forex broker, make sure you are using one that is locally licensed and regulated, choose one here.