Is Forex Trading legit? Is it possible to trade safely? The forex market is challenging, and trading on Forex is difficult & entails risk due to scams, but forex trading is legit. However, you must be aware of the forex scam brokers in order to avoid loss. Forex trading frauds can damage your investment, and it’s impossible to recover money once you fall prey to the fraudsters.
Moreover, the forex market is volatile and has ample risks. It’s not a place to put all the life savings that you cannot afford to lose. The CFTC has observed and reported a sharp rise in forex scams in recent years. So whenever you want to invest in forex trade, it’s essential to identify trustworthy and reliable brokers and avoid the ones that are not. However, it is quite challenging to spot a scam. So in this blog, we have mentioned some basic red flags that can help you spot a fake broker and also check out the list of fake brokers to avoid dealings with.
Forex Market Scammers
Brokers do not always represent foreign exchange brokers as they are individual players who act like reliable & professional brokers. Often they are expert internet users who can fabricate fake details on the site they have made. However, these fake scammers do not have licenses and are, therefore, not authentic and regulated by authorities. They just made their sites so catchy with the promise of high returns.
As a result, a novice trader signs up and makes a deposit. And here, the exciting part starts, and there is the fraud by the technology and a broker. However, forex scams are of two types:
1. Fly-by-Night Brokers
Fly-by-night scam brokers are the most common. A group of individuals create an attractive site as a copy of original trading platforms and maintain the home page with attractive promises. They often use fake ratings and attractive graphics to urge people to invest and get high returns. As a consequence, they gather deposits from different investors and disappear overnight and also close their websites. Sometimes, they call it a pre-planned bankruptcy and sometimes don’t even make any statement.
2. Forex Bucket Shops
This type of scam is more polished and needs more careful preparation, but the potential profit of the fraudster is also higher. For this, they generate a full-grown platform that copies the functionality of leading forex brokers. The trader does not play on the world interbank market but with the people registered on their fake site or even with the platform itself. However, forex bucket shops generate unfeasible conditions so that the site itself remains in the black while people constantly lose their investment.
List of Forex Scam Brokers
Since the beginning of online trading, scammers have been making difficulties for investors. Every day you will encounter fake forex scammers or other types of blacklisted brokers looking to fraud unsuspecting victims. Sometimes, they duplicate everything like an original site, and even professionals can’t differentiate between a fake and a real platform. And sometimes, they even make pyramid schemes, and traders unknowingly pull themselves and their friends into this fraud. So, here we have made a list of fake brokers recently reported by different recovery platforms. The list will assist you in avoiding fake brokers.
- IGM Forex
- Margin Elite
- Matrix Capital Trade
- FTE FX
- IC Finance
- ADN Markets
- Blue Trading
- Pro X Finance
- Golden FX
- Gulf FX
- Bristol Consulting FX
- Meta Investing
- Swiss Assets FX
- Adamant Finance
- AGM Markets
- Alpha Trade
- Boston Merchant Financial
- Circle Markets
- DV markets
- Forex MMCIS group
- Forex Optimum
- FW Markets
- Capitals Banks
- AAFX Trading
- HBC Broker
- GDM FX
- Primus Trades
- Mplus Social
- 365 FX
- Boom Xchange
- Option Expert
These scam brokers have been reported as looting investors by using different scams. The list also includes some forex bucket shops & pyramid scheme launchers as well. So, you must avoid scam brokers with no track record or license because they are usually fly-by-night brokers. However, there are lots of scam brokers in Forex, and we can’t give you the name of all scam brokers.
How to Spot Forex Trading Scams?
The most significant thing a person can do to avoid being scammed is properly understand how to trade on the Forex market. However, the most difficult task is to find a reliable broker. As Forex is the largest trading market, it takes years to be master in trade accurately. If anyone claims high returns, don’t fall for them. Below are some warning signs you must consider while selecting a broker.
- If any broker promises high returns, don’t believe them because no reliable broker can pledge high profits to the trader.
- Another fraudulent dialogue is that you will not encounter risks; it clearly warns of scams.
- If you encounter a broker that has no registration by law or does not have any regulation. Don’t trade with them. Hence, you can find the details about regulators on the broker’s site, and you can also check it from the regulator’s website.
- Unprofessional activities include calling another way of blacklisted forex scammers who offer you high profits and force you to pay. This is a 100% scam. Don’t deposit any amount.
- Many scam brokers point out their top position with some rating tools. But they only display ratings on their site or on a third-party resource that really belongs to the same person and has no influence in the forex market.
- Every broker sets its own charges, but scammer operations will be more hostile to these fees and try to loot some additional fees with cheap tactics.
- Sometimes, lack of communication is a sign of a scam, as they will not give you many details. If they are not responding to your queries, it’s a red flag.
However, if you encounter any broker that claims the abovementioned promises or is not regulated by any law, then don’t trade with them.
Protect Yourself From Fraudsters
The forex market is the largest trading market where trillions of currency units are traded daily. To protect oneself from fake scammers, you must be very vigilant. Do your own research and check reviews. It will give you insights about a person. Ensure there are no such negative comments. If you find any reviews about scams, contact them to get a clear understanding.
Moreover, it’s also important to check the regulation status of the broker, whether the broker is legally operating in the market or complying with the rules and conditions of the regulator. If they are not, then they may be scammers. However, each regulator body has its own ways of checking forex brokers. You can confirm the reliability of a broker through regulatory bodies such as CFTC registration and NFA membership status of a specific broker. So, you must check the broker’s license before giving them your personal information.
To avoid being scammed by fake brokers on the forex platform, you have to do some research to know the history of a broker and its regulatory status. Observe the red flags and ask as many questions as you want before investing. However, the surge of forex trading scams is alarming, and due to that, the genuine broker also faces the issue. That’s the reason many people are afraid to trade in Forex, even with authentic brokers. We have mentioned the list of scammers, so if you come across any fake brokers, let us know in the comment section, and we will include them in a list.
If any broker scammed you, you should file a complaint with us. We have a great team that will help you in recovering your funds.