Don't Get Caught Out - Here's a Forex Scam You Need to Avoid.
As a legitimate forex trader, one of the things I like doing for the community (and those interested in getting involved in it) is finding out and highlighting scams. As I stated before, a scam can be when a company misrepresents itself. The last time I touched on Forex scams was because of a particular MLM scheme purporting to be forex trading, but really just selling signals. You can read about that scam here. However, as I dive deeper into FX trading, I realize there are other, more nefarious types of scams.
Misrepresentation to the Public.
According to Cornell Law School, misrepresentation is a statement (or an omission of information) that leads to other statements being misleading, intending to deceive the reader. A company may use misrepresentation to drive traffic to a site and potentially get clients to sign up. It's an underhanded method, but if what the company is selling is something viable, then it's probably not so bad. Many of us might have never bought our phones or other digital devices if we weren't first "sold" them by marketers. However, there is a point where misrepresentation gets murky.
Facebook Ads and Their Penchant for Selling Dodgy Merchandise.
I might have said it before, but Facebook Ads are among the scummiest ads in the business. Once a business or individual pays Facebook, as long as it isn't overtly against the company's terms of use, they can shill for any scam. As someone who has their finger on the political pulse of my country, I've even seen political figures being used to sell dodgy things like trading schemes and investment advice. None of which is legitimate or actually works, from what I've seen. They entice someone who knows the public official to click on the ad and sell the visitor on an idea using a lot of fluff words and promises that never materialize. Because of the cultural nature of my country, people who get caught with these schemes almost never talk about it.
An FX "Broker" That Misrepresents Itself.
As a case study, I decided to use one of those Facebook Ads I got as I started writing on Forex again. I'll try my best not to mention the name of the company and blank out their company logo and imprint, but the ad should be recognizable enough for anyone who's encountered them. When looking for a broker, you need to find a reputable and regulated company. The first thing that drew me to this company was the line they had on their ad saying, " is Authorized and Regulated by the Trinidad and Tobago Security and Exchange Commission." Here's a company that's regulated by my country’s own TTSEC! I can trust that, right? Well… not exactly.
The Trinidad and Tobago Laws on Foreign Exchange.
In T&T, according to the Exchange Control Act of 1971, a person may freely buy, sell, borrow, or lend gold and foreign exchanges outside the country's borders. However, if that same act were to happen within the country’s borders, it would need to be done through an authorized dealer. That in itself says that the TTSEC may regulate foreign exchange transfer, but it would be a gray area to trade with a broker operating out of this country. Are they a registered trader of foreign exchange? If you're a trader, don't YOU need to be registered to trade foreign exchange?
Is It a Scam?
It's hard to determine if the company is legitimate or a scam. However, a few VERY red flags show up here. Among them are:
A contact within the TTSEC has told me that while the company is registered with them, its status as an FX trader is not There is no license for the business as an authorized FX trader There is no consideration for individuals trading FX on the company's platform within T&T since they are subject to the Exchange Control Act (1971) themselves.
While the service and brokerage they offer might be legit, a few things play on the edges of the law, a bit too close to the edge for my comfort. Should you sign up with them? Probably not.
As an FX trader in the business for over a decade, I think I have a pretty good grasp of these topics. If you're interested in learning FX trading as a beginner or are just interested in seeing what I say about foreign exchange movements, feel free to subscribe. Email me if you want one-on-one coaching, and we can work something out. Until next time — be careful with who you sign up with as an FX broker.
Чтобы просмотреть или добавить комментарий, выполните вход Чтобы просмотреть или добавить комментарий, выполните вход.