Forex Trading Scam
A Guide to Forex Trading Scams
Forex is one of the most popular forms of trading. Individuals and institutional investors welcome the opportunity to make money relatively quickly. However, there are also many risks involved, including bitcoin scams, forex trading scams, and falling victim to unscrupulous brokers. While governments propose tighter regulations on forex, the multiplicity of scams mean that traders should tread carefully.
What Is Forex?
Forex is short for “foreign exchange” and involves trading the differences between currency pairs. Given that currency values can fluctuate quickly throughout the day, it is a fast, volatile form of trading. This can be attractive to people who want to make some fast money, but can also make traders vulnerable to large losses.
In addition to quick returns, the other aspect of forex trading which attracts people, particularly first-time traders is it involves something many people feel they understand. Anyone who has spent time abroad has had to deal with the necessity of exchanging currency.
Since no one likes to lose money, tourists will often strategically plan times when it is best to change money. They are behaving somewhat like a forex trader; they may convert currency at a certain time if they expect it to decrease in value the next day or they will wait to change money for a time when it has a higher value.
Those who expect forex trading to be as simple as changing money during their last trip overseas may find it more complicated than they initially imagined. There are many factors involved in forex trading that make it extremely volatile and challenging for first-time traders.
Additionally, it can be difficult for individual traders to perform as well as institutional investors who have tools and large numbers of people focused on currency fluctuations. Many of the moves in the market can be caused by these huge investors conducting mass buying or selling of currencies, and it can be hard for an individual trader to predict the direction of currencies in this environment.
The Problem of Forex Trading scams
Forex trading is more challenging than most people think when they sign up with a broker promising them that they will make huge returns fast. The volatility of the trading attracts those who perpetrate forex trading scams.
They can cover absconding with funds by claiming the client lost money through the trade and since the time frame is so short, it can be hard to prove they are wrong. If the forex trading scam artists are dealing with people who admit they have an appetite for risk, they can count on them being less upset if they lose money and can disguise the true reasons they are not receiving a return on their investment, which in some cases, is theft by the broker.
They can cover absconding with funds by claiming the client lost money through the trade and since the time frame is so short, it can be hard to prove they are wrong. If the forex trading scam artists are dealing with people who admit they have an appetite for risk, they can count on them being less upset if they lose money and can disguise the true reasons they are not receiving a return on their investment, which in some cases, is theft by the broker.
Since forex is so popular, the number of forex trading scams disguised as legitimate investment opportunities and services has grown. It can be difficult to distinguish forex trading scams from the real thing. With due diligence, research, and advice from services such as Broker Complaint Registry, you can work with a legitimate broker and stay safe from forex scams.
Knowledge is power. It is essential to be informed of common forex trading scams and how they operate to avoid being taken in by them. The following are some common types of Forex trading scams to recognize and stay away from.
Knowledge is power. It is essential to be informed of common forex trading scams and how they operate to avoid being taken in by them. The following are some common types of Forex trading scams to recognize and stay away from.
Forex Trading Scam Bots
“Make money while you sleep” is the promise for some automated tools and bots that are advertised to help novice forex traders make a bundle. The reasoning may seem sound at first. If currencies fluctuate while you sleep, eat, spend time at work or the gym, why not have a bot take care of trading for you. The technology is supposed to track changes in the currency value and make automated trades based on fluctuations.
It may sound too good to be true, but it isn’t quite as far-fetched as it sounds. The concept of forex bots is not inherently problematic. Many legitimate forex bots do a great job alerting traders and making forex trading easier. The problem is the quality of the bot in some cases and the hyped-up claims.
Exaggerated claims are an issue in their own right. No bot can let you just be unconscious and unaware of trading. Bots require some input and maintenance and a bot is only as good as the developer. These bots are intended as tools rather than replacements for real trading.
The other problem can be with the bots themselves. Forex trading scam bots are worthless and do not do even a fraction of what their sellers claim. These sellers often disappear once they have made the transaction and block people they have cheated.
Forex Trading Scam Brokers
Fraudulent brokers are another type of forex trading scam. In general, always avoid brokers who do the following:
- Are not regulated
- Do not provide transparency about fees, commissions, and spreads
- Do not allow a variety of platforms, payment, and account options
- Are evasive when asked questions and do not adequate customer service
- Have a fake address or telephone number
- Has a statement that they reserve the right to adjust fees or rules about withdrawing money or can close an account for any reason
Signal Seller
A signal seller is a type of forex trading scam that focuses on the difficulty of this type of trading and claims to offer advice to a trader. These so-called forex experts will advertise their services for fees and will try to get people to subscribe for an entire year. Then they will either offer phony advice or disappear entirely.
Have You Lost Money to a Forex Trading Scam? BrokerComplaint Registry Will Help
Contact Broker Complaint Registry experts if you have lost money in a forex trading scam. We deal with a variety of issues, including data theft, broker scams, and crypto complaints. Our team will refer you to experts who have vast experience dealing with regulators, banks, and law enforcement. We will provide advice and give you valuable guidance to help you get a refund.
