If you've been ripped off by scammers, get in touch and our team of experts will work to get your money back!
The Forex industry is one of the scammer's favorite grounds. Since the industry is generally known as a legitimate investment option, it is very hard for the average person to differentiate the scam brokers, from the legitimate ones. Usually, most people don't even know they've been scammed, they just think they had “A bad trading day”. If you feel that the way you lost your money trading, is more than just a “bad day”, contact us now. If your Broker is a fraud, we might get your money back!
Performing preliminary checks to assess whether the case can result in a substantial recovery, based on our experience.
Collecting all the information and documentation required to successfully pursue your case. [*]
Systematically confronting the relevant entities that have facilitated the illicit transfer of your wealth.
We take pride in our track record and assure you that we'll go to great lengths to get your money back.
We want to make sure you know everything there is to know in regards to forex scams and fraud. While our primary job is to help recover financial loss for clients who have been scammed or being involved in some kind of fraud, ideally we want to help you avoid these scams in the first place. So be vigilant and knowledgeable.
Forex is the single largest traded market globally, with up to five trillion traded each day and is considered decentralized because there is no central processor for trades– in other words, there is no entity that acts as a central exchange like the NASDAQ or the NYSE. Instead, orders are completed by millions of traders using millions of various forex brokers around the world.
Foreign currency trading is one of the most leveraged markets in the world as well. In the US, regulations limit a person to 50:1 leverage. In other countries, they have zero limits on leverage. It is not uncommon to see some non-US brokers offer 1000+:1. Due to these factors and a few others which we will discuss, this is why scams can be so prevalent within the foreign exchange market.
In the investment world, forex is the wild-west of traditional financial instruments. However, most of the participants are massive institutions like banks that help companies manage cross-currency rates for payroll or buying goods. But it is by far the most accessible and cheapest investment for anyone to make. A futures broker may require a $5,000 minimum investment; whereas many firms in the foreign exchange markets require as little as $1. Day trading stocks in the US requires a $25,000 minimum balance; forex does not require this.
The ease of access to significant leverage, and the fact it is open 24 hours a day all make it the most appealing market. But this also attracts many of the bad actors. Some countries regulate forex markets – but not always to the same degree as the US. Many countries have little to no regulation and allow anyone to open a brokerage account in their country. There are many, many bad brokers around the globe – so it’s often best to stick with brokers that are based in the US, EU, or UK.
Using a regulated broker ensures that: your money is safe, the data and information provided by the broker are compliant with industry standards, and the broker is operating legitimately and ethically.
The forex trading space is rife with services and individuals bent on defrauding new traders. Avoid bad brokers, false education programs, performance history lies, and fraudulent automated trading systems.
If you have been the victim of a scam in the forex space – there are options available to you, provided by our specialist at our firm.
Cryptocurrencies are the Wild West of investing and speculation. It is vital to work with a virtual currency platform that is reputable and – ideally – regulated. Thankfully, in 2020, there has been ample time for reputable cryptocurrency exchanges to develop. Perhaps the most well known, respected, and trusted is Coinbase. Other notable and trustworthy crypto exchanges are Bitstamp, Kraken, Binance, and Bittrex. But don’t take just our word for it! Do your due diligence and make that regular habit when it involves cryptocurrencies!
Mining is how cryptocurrencies like Bitcoin are created, a process known as Proof of Work. Mining requires significant computational power to complete highly sophisticated algorithms to record transactions on the distributed ledger. When ‘blocks’ are mined and added to the ‘chain,’ the miner is rewarded with Bitcoin. Because mining requires time, resources, power, and infrastructure, many scams seek individuals to ‘invest’ in mining projects, a form of passive income. Thankfully, this scam is less common with the advent of 3rd generation blockchains like Cardano that use a staking system versus mining – no massive power or infrastructure requirements and allows individuals the opportunity to make passive income much easier than with the legacy mining processes.
Bitcoin (and all cryptocurrency) is held in digital wallets. Wallets have two keys – a private key and a public key. A public key is basically like aan address to send something to. A private key is what gives permission to spend or send your cryptocurrency. Bitcoin wallet scams are a common scam that targets new entrants to the cryptocurrency space. Because cryptocurrency is held in digital wallets, many cryptocurrency fraud schemes have come into the space encouraging you to utilize their wallets. Some scams involve asking you to send your private key – don’t!
A scam that is almost endemic in the cryptocurrency space are pump and dump schemes. Similar to what happens to stocks, pump and dump scams involve an individual or entity acquiring a large amount of an alt-coin and then pushing positive news (fake or real) to encourage as many people to buy as possible. Social media platforms are the primary outlet that pump and dump operators utilize. Once the price has moved up, the operators sell at the top and then let everyone else suffer the consequences of rapidly falling prices.
If you want to learn an excellent example of a pyramid scheme in the cryptocurrency space, look up OneCoin. Pyramid schemes in cryptocurrencies are the same as Ponzi schemes in any other market; the only difference here is that the fraudsters are now capitalizing on the growth of cryptocurrencies to target you and make you believe you’ll become wealthy overnight.
ICO stands for Initial Coin Offering. This is similar to the IPO (Initial Public Offering) process – but without the traditional regulatory process. Between 2016 and late 2018, the cryptocurrency market was slammed with, literally, tens of thousands of new altcoins entering the market, all promising to be the next Bitcoin or Ethereum. Some of these new altcoins generated millions of initial investment from individuals, and when prices spiked, the owners sold. This is similar to a pump and dump, but it’s an exit scam when it involves an ICO. While the industry is still very new, it has matured some since 2008. It’s crucial that you do your due diligence and investigate, thoroughly, any new cryptocurrency. This is especially true if you came across it on social media.
A growing trend in the cryptocurrency space, specifically the decentralized finance (DeFi) space, is high yield interest rates. There are many legitimate platforms that allow you to deposit or ‘stake’ various cryptocurrencies and reward you with a high-interest rate. It is not uncommon to see regulated and legitimate projects offer up to 10% interest on stablecoins (essentially cash) or up to 15% for Bitcoin and Ethereum deposits! But be very, very cautious about any promise of return higher than 10% to 15%. And you must read the ‘fine print’ of even legitimate and regulated entities. There are some projects that require you to leave your deposit for up to 90-days in order to earn the highest yield.
When Bitcoin and others became a tradable market, there were few exchanges that were available. As time went on, more and more exchanges popped up. But not all of these cryptocurrency exchanges were legitimate. Many were fronts that looked and appeared to be a place to buy and sell cryptocurrency. The owners of the exchange would wait until a significant amount of people deposited and even began to trade on their platform until the owners would essentially pull the plug and take your cryptocurrency investments. Along with cryptocurrency exchange scams is the lack of security of some cryptocurrency exchanges. The most infamous example of this occurred in 2014 when Mt. Gox (which processed over 70% of all traded Bitcoin) had 850,000 Bitcoins stolen (millions of dollars). Regarding fake cryptocurrency exchanges, there are some that use fake volume to artificially inflate the trading volume and liquidity of the exchange. While this activity is still prevalent, a form of self-policing in the industry exists with the website coinmarketcap.com classifying every cryptocurrency exchange as those with honest reported volume or dishonest volume.
The scams that exist in the investment world are many. One of the hardest things for new and aspiring traders to overcome is the vast amount of wrong information, bad actors and blacklisted scam brokers trying to take advantage of you.
Here are some of the different types of forex trading scams:
The US and EU (more recently) have limits of around 50:1.
If you see a broker offering 500:1, 1000:1, or anything beyond a conservative amount, stay away. This is a predatory action.
Avoid any broker that is not clear about margin requirements.
Avoid requirements for a minimum Stop Loss or Profit Target.
Avoid requirements where you must have a trade open for a certain amount of time before you can exit.
Avoid anyone that doesn't allow you to create your own risk management profile.
You should be able to withdraw your money from your brokerage account at will – but some don't allow this.
Avoid minimum requirements for volume traded before you can withdraw.
Avoid anyone that doesn't disclose their withdrawal rules.
The US and EU (more recently) have limits of around 50:1.
If you see a broker offering 500:1, 1000:1, or anything beyond a conservative amount, stay away. This is a predatory action.
Avoid any broker that is not clear about margin requirements.
If a broker advertises a bonus on deposits, make sure that you can withdraw the bonus within a reasonable amount of time – it should be clear what the requirements are for you to withdraw the bonus.
The spread is the difference between the Bid (buying) and the Ask (selling) – This should be clearly defined or be avoided.
Avoid brokers that don't warn you of regular increases in the spreads, such as at the end of the day or during certain holidays.
Forex signal sellers are individuals who want to sell you signals or advice – they want to tell you what pairs to buy or short, when to exit for profit, where to put your stops, etc.
Millions of signal sellers out there are all selling you on their success with messages like, “3,000 pips a week!” – a pip is how you measure movement in the exchange rate. The average pip range that the EUR/USD moves a day can vary between 30 to 50 pips.
Avoid people or companies that promise or allude to a guarantee of profit. Avoid entities that promise unbelievable returns like: “90% win rate!” or “188 winning trades, 12 losing trades!” or “MASSIVE GAINS.”
Avoid sites that have side advertisements and banners promoting a single broker.
People who promote a single broker generally have some agreement with them. Many non-US brokers offer various incentives for people to find new customers. They may offer the seller a cut of your deposit or a rebate on any trade you make.
If someone tells you about a broker or if a site is promoting a broker – ask if they have an IB (introducing broker) agreement with them– this must be disclosed in the US when asked.
Be wary of the myriad of free or paid trading education opportunities
Many sites look incredibly professional and may even link certification organizations without their permission.
Check for quality educational providers from the CMT Association (Certified Market Technicians Association), IFTA (International Fellowship of Technical Analysts), or STA (Society of Technical Analysts).
Even by professional US brokers, a significant amount of the education provided is decades out of date.
It is best to avoid anyone selling forex robot trading systems
AI systems have existed since the 1990s for retail investors– but nearly 100% of them fail.
The current buzzword for investment scams is ‘AI.' Avoid anyone that claims they use Artificial Intelligence. There are only two known private hedge funds that have anything close to authentic self-learning AI. They are not selling their bots to anyone.
Think about this logically: If you created a profitable AI (virtually a money printing machine), would you ever tell anyone about it? Would you sell it? Probably not – your advantage disappears when others have access to that kind of a tool.
Automated Trading systems are a common way fraud is committed by forex scammers.
The US and EU (more recently) have limits of around 50:1.
Avoid any service or individual who has ‘high lifestyle' imagery, such as girls in bikinis on a yacht, Lamborghini or Ferrari in the background, massive mansion or house, or a private jet.
A good rule to follow for any investment or speculative endeavor: if it looks or sounds too good to be true, it probably is.
Recovering funds in the forex trading market is difficult. The difficulty increases when you use an unregulated broker. Adding to the problem is the near impossibility of recompense from the scammers who defrauded you.
But we have a proven track record of success in helping investors who have been the victims of a scam or fraud. We are a regulated fund recovery company that focuses on some of the more complicated financial investments: forex, binary options, cryptocurrency, and stocks.
In addition to our professional forex recovery services, our team of experts focuses on customer outreach and we attempt to mitigate the damage that fraudulent actors have caused to our clients.
Contact us today for a free consultation and our professionals will work with you throughout the entire process to get you maximum returns!
No – but there are scams and fraudsters that create pyramid schemes. This kind of behavior exists everywhere and is endemic to all traded financial markets. If you are looking for a broker and they’re offering to put you into a ‘team’ to build a network, odds are it’s a pyramid scheme. Read our related article: What is a pyramid scheme and how to avoid them.
Several major regulatory bodies/agencies around the globe regulate forex markets. In the US, brokers are regulated by the NFA (National Futures Association) and the CFTC (Commodities Futures Trade Commission) – but not FINRA (Financial Industry Regulatory Authority). In the UK, the main regulatory body is the FCA (Financial Conduct Authority). In the EU, all nations that make up the EU have their respective regulatory agency– but the standards that each member State must maintain are established in the MiFID (Markets in Financial Instruments Directive).
Great question! One of the first signs that the broker you are looking at is legitimate is if they disclose that they are registered with a specific regulatory authority such as the FCA (UK) or CFTC (US). Another great way to determine legitimacy is to read reviews by current and former customers.
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