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Identifying Forex Scams

Identifying Forex Scams

As long as the Forex market exists to do trading there will always be opportunities for scammers to work and commit fraud. Scammers will always find ways to scam you but making it hard for you to claim against them.

If you are or have been tempted to try your hand in forex trading then there are some tell-tale signs that you can use to help decide which broker is a genuine one or more likely to scam you.

There are ways that you can protect yourself.

Forex scammers target on the vulnerable, uneducated, weak and desperate people who are trying to make money quickly.

Attempting financial trading without any education or training is like jumping out of a plane without a parachute – a good chance you will not survive.

Learn the basics of how forex trading is done, a good site is babypips.com . Once you know what is going on then you are better prepared against a scammer.

How Forex scams work

There are many ways forex scams can work.

Forex scams offer a too-good-to-be-true investment opportunity, to make you part with your money. You will be exploited and manipulated and they will excite your imagination.

They will make you exciting offers and get you to think about what you can do with extra money you make. Forex trading carries extremely high risk and you can lose more than you out in.

Losses as well as wins are part of the trading way – with the idea that you win more than you lose.

Spotting a Forex scammer

They tend to  guarantee large profits with little or no financial risk. But there is no such thing as a 100% guarantee, otherwise everyone would be doing it.

Some of these offers like bonuses  sound very attractive, but they come with an awful lot of conditions.

If something sounds too good to be true then it probably is. Always play safe and don’t buy into these quick rich suggestions

Only use brokers that registered with a regulatory authority. I would always recommend using a broker registered with the FCA. There are many brokers who are registered in Cyprus and when you google scams or issues most tend to be originated with brokers from Cyprus. The UK FCA authority is much easier to complain to and make claims than those in Cyprus.

Always google a broker and check reviews thoroughly. They often make unsolicited telephone calls to convince you to invest, with high-pressure sales technique.  Ever seen the film Boiler Room?

Never send can directly to scammers  – always use your credit card to make payments if you feel its safe to do so.

Never give personal details until you are satisfied they are safe to transact with. Expect a written risk disclosure statement., which if not provided can be a signal of fraud. Always read them carefully and all T&Cs as usually there are some clauses hidden in the details.

How to avoid Forex scams

Here are some red flags that you could be getting scammed.

1.       If a broker gives you advise what trades to do then never listen to it – in many cases advice given has led to losses

2.       If the broker advises never to use stop losses then another red flag. Always place stop losses on all trades.

3.       The stake per pip is also a signal, only use brokers that allow you to make 0.1 or 0.01 stakes, some brokers increase the starting stake which commits you to put down lots of money to run a trade and potentially could put you in the red fast.

4.       Always make sure a broker does a KYC – Know your customer review with you

5.       Always be wary if you are told you a VIP customer.

6.       And again never follow through with recommended trades.

7.       Never listen to the broker when they keep suggesting you need to put more money into your account to cover losses.

 

Take your time. Only use companies in my opinion who are FCA registered to increase your protection. Always make sure they have a proper address not a contact address and be sure to google their names thoroughly.

 

If you have been a victim of a forex scam or you need advice you can contact Phoenix Advisors Group and they can examine your case or query and give expert help and advice.

www.phoenixadvisorsgroup.com

 

 

 

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