Should You Trade with Moneta?
Moneta is a broker that seems legitimate. It has a license from the South African financial authorities and offers a wide variety of trading products. However, there is another side to Moneta. Customers from all areas of the world aren’t offered the same protection. It seems that Moneta is two brokers rather than one.
Moneta was founded in 2009 and has its headquarters in South Africa. It has a license from the FSCA, the South African regulatory authority. However, it also has licenses from Seychelles FSA and St. Vincent, and the Grenadines SVGFSA. These last two licenses are far less impressive than the FSCA license, but we will discuss why later.
Moneta is a CFD and forex broker that offers over 900 trading products and claims it has 70,000 clients. It has won a number of awards and offers low spreads and fees. However, this is true in South Africa and some other countries. In many areas of the world, Moneta offers services that it wouldn’t be allowed by the FSCA. That’s why it also has a third-rate license from FSA and SVGFSA.
Possible Benefits of Trading with Moneta
Moneta seems like an excellent broker. It has won several awards and has a first-rate license from the FSCA. Moneta also allows traders to use WebTrader and MetaTrader 4 and 5. Customers can open an account with as little as $50 and there are no withdrawal or deposit fees. Moneta doesn’t even levy inactivity fees, so customers can take a break from trading without being penalized.
As a registered broker, Moneta offers most of its customers security with segregated accounts and negative balance protection. Its spreads are competitive and low for the industry. Keep in mind, though, that all of these advantages are enjoyed only by clients located in regions covered by their FSCA license.
Here Are Some Red Flags Concerning Moneta
Moneta clients in areas not covered by the FSCA regulation may not recognize the positive qualities mentioned in the description above. Moneta can seem like a very different broker to them. These are some red flags concerning Moneta:
- Leverage can be as high as 1:1000
- Has two types of licenses
- Doesn’t offer the same protection everywhere
- Customer complaints
Leverage Can Be As High as 1:1000
Leverage is often considered to be a good thing, at least for investors who are looking for high risk and high reward. However, leverage can be dangerous and can get traders into debt very quickly. That’s why regulators put a cap on the maximum amount of leverage, usually around 1:30 at acceptable risk. When brokers advertise leverage in the hundreds or in the case of some Moneta accounts, at 1;1000, that is a sign that you are dealing with an unregulated and possibly a scam broker.
But wait. Moneta has a quality FSCA license. But it also has licenses from Seychelles and St. Vincent and the Grenadines, which allows it to have dangerous leverage of up to 1:1000. This implies that Moneta isn’t really a quality broker and will put their traders at risk if they are allowed to. A reliable broker should not offer this kind of leverage on principle.
Moneta Has Two Types of Licenses
Have you ever referred to a person as “two-faced?” They show one side to one group of people and a darker one to another type of person. Moneta can be accused of being a two-faced broker.
There is no reason why a legitimate broker should have a first-rate license as well as a few that aren’t worth the paper they are printed on. The only possible reason is if they are thinking of offering services that their respectable regulators don’t allow.
Even if you have a license with Moneta in an area under the jurisdiction of the FSCA and are enjoying benefits like negative balance protection, you may wonder about trusting your money with a broker that would have such a shoddy license, such as a paper from Seychelles and St. Vincent and the Grenadines. The question of integrity should be relevant to your financial security.
Doesn’t Offer the Same Protection Everywhere
We discussed above the problem of offering a reasonable 1:30 leverage in some areas and a shocking 1:1000 leverage in others. Leverage is just one example of the different levels of protection offered to Moneta clients.
It’s clear that some of Moneta’s clients enjoy full FSCA protection while others are at the mercy of FSA and SVFSA which don’t offer any oversight at all. Brokers that have this kind of paltry “regulation” can pretty much do anything they want. What’s a respectable award-winning broker like Moneta doing with such a shoddy license?
Every broker or merchant gets complaints once in awhile. We can’t take seriously everyone who claims they “lost money” from X broker. They could have lost money simply because they didn’t make good trading decisions. Also, it’s important to maintain an attitude of skepticism about reviews on sites that allow just anyone to leave comments.
However, where there’s smoke, there’s usually fire. We’ve received verified customer complaints about Moneta, and they aren’t just upset because the market isn’t strong. However, we’ve seen the consequences of Moneta holding a two-tier license policy, and it means that not all clients get the same protection.
Should You Take the Risk with Moneta?
You could decide to go ahead and open an account with Moneta. It’s safe to do so if you are located in a region under the FSCA jurisdiction. However, others should realize that Moneta isn’t the same broker for them. They put them at risk with high leverage and don’t have the same kinds of services.
Even if you are located in an FSCA area, you may decide to look elsewhere. Why should you trust your money with a broker that shows questionable integrity? The choice is yours.
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We create these reviews to warn consumers about brokers and schemes that may be fraudulent. If you have an account with this broker close it and request a withdrawal. If you are not given your money back, contact Broker Complaint Registry right away. We will consult with you, work to track down your funds and create investigative reports, and will assist with fund recovery efforts.