Most new investors do not do any research, and end up becoming a victim of an Online Investing Scam. There are literally hundreds of Investment scams that happen on a daily basis, and most people are totally clueless.
Your Broker is a Scam if:
- They use words like “Safe & Secure” but do not have a valid license.
- After you deposit $250, they pressure you to invest $5,000.
- A broker calls you offering a “Managed Account” with steady returns.
- They tell you that their company doesn’t need a license.
- They ask you to deposit more money (a profit tax), so that you can withdraw.
How to Prevent Becoming a Victim
The first step to avoid an investment scam, is by properly researching your online broker. Ask yourself these questions.
- Does my broker have a valid license from my governments financial regulator? (FCA United Kingdom, FSCA South Africa or Australia ASIC.)
- Is the broker (salesman) always calling, and pushing me to deposit money?
- Does the brokers license protect investors from my country?
- Can I easily withdraw my money?
The second thing is to watch out for is fake Trading Systems.
- 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.
- If a software or person opened your account for you, they can access to your account.
- Most Important! Historical results are never an indicator of future profits.
Look at some popular licensed brokers.
Test Drive Your Broker!
There is absolutely no reason to invest with an offshore or unlicensed broker. If you think you need high leverage, you are mistaken, and you will lose your money fast.
You should setup a demo trading account, at a legal regulated broker. You will see that trading is difficult, and profits are hard to make. But at least, at a licensed broker, they will not steal your money, and block your withdrawal requests.
Get a Demo Account at: Forex.com.
You can find more licensed brokers, listed here.
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 Crypto investing, there has been a surge in complaints about bad Forex CFD brokers.
Make sure to properly do your research, and don’t be naive and 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 fifty more 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.