Don’t be Deceived
Sadly, online trading has resulted in a multitude of scams that prey on unsuspecting victims. FxZoo wants to ensure all of our readers are aware of such unscrupulous behavior so here goes with one that we are aware of:
High Yield Investment Programs
It sounds so legitimate and the kind of offering you would find from a respectable financial service provider! The pitch “earn a high level of return for temporary use of your equity in our Foreign Exchange Fund”. Bottom line is these are your bog standard Ponzi schemes – whereby old investors get paid by new investors. Once the “Fund” runs out of new investors they usually close the fund and take all their investors’ money. Invariably these Funds offer amazingly high returns that sound too good to be true – hint: too good to be true = fake/false. They will state a return of 20%+ within 2 months – returns that are impossible to deliver. These crazy claims are made to “lure” you into depositing your hard earned cash with them.
These Funds will downplay the risks involved with online trading, telling you that a written risk disclosure statement is just a routine formality imposed by the regulator. Always be wary of statements claiming that a Fund/Company will recover any loses or that your investment will remain safe. We can’t stop stating that any form of online trading involves a high amount of risk, and you may end up losing all or part of your money. Do not invest money which you cannot afford to lose!
Such Companies/Funds make it difficult to get their performance track record. So be skeptical of such companies that provide none or incomplete information about their performance history. All reputable, Companies and Funds will be a member of their local regulator (FCA, CySEC, ASICS, NFA, CFTC etc.). Even if the sham company provides a glossy brochure (likely filled with false information) check with the regulators website to see that the company is a regulated member before dealing with them.
Don’t deal with anyone who won’t readily give you their background information. Use the web and investigate the company or broker you are thinking of doing business with. Check with their regulator for any fraud alerts or sanctions.
So the moral is:
• Too good to be true – then it is not true i.e. it’s false!
• Research, research and then research some more
• Only invest what you are prepared to lose
#tradesafely #fxzoo #doublehit