What is Forex Trading?
Forex stands for foreign exchange. It is a trading practice that involves exchanging one currency for another in the market. Exchanging a USD for a EURO or any one of the hundred or so Federally backed coins in existence. This helps in international travel, for conducting business, for foreign trades, and for global outsourcing and paying vendors and suppliers. There are over 180 currencies in the world right now.
The need to exchange one for another is critical for the way we work and take care of our business and travel. Nevertheless, the market is largely unregulated — this has made it a perfect place for scammers.
The market is also global which makes it that much more difficult to track down crooks, and, in some places, said crooks are even protected - due to judicial firewalls - from persecution.
What effects does a Forex scam have on a victim?
It’s disheartening the way a scam of this nature punches a person’s spirit. It fills them with intense shame, guilt, and severe depression. The monetary loss comes second to the emotional turmoil such a scam has on a person. It’s important to understand that it wasn’t your fault, that you’re not alone, and that thanks to us there you can get some payback.
Types of Forex Scams
There is an alarming rate and upsurge in Forex scams — this is mainly due to the fact that there is no regulatory body, so there’s no one overseeing the market. Each country does have some regulations but due to international policies and issues, those regulations only work within their cloistered market, once you go digital things change.
Some of the most common scams are:
- Robot Trading Systems: these types of programs are based on our propensity to automate everything. On our desire to earn a passive income while sipping margaritas on a beach. This is what makes them so attractive and why scammers use them so often. The scam is simple, crooks use the fact that there are a lot of legitimate robot trading platforms - that do work - in order to slip one into the system. They offer you their platform with proprietary tech and give you great benefits for using it. Unfortunately, the platform either doesn’t exist or the algorithm works poorly — you fund your activity and then watch as your capital up and disappears.
- Binary Options: scammers will claim to be international firms with legit-looking websites. Once the firm gains your trust they manipulate the system — they distort prices, payouts, and charge bizarre fees. In due time, they will close your account and pay only a smidgen of what you invested.
- Signal sellers: scammers that act like “forex advisors.” They will charge you a consulting fee and their “trading tips” are never useful.
- Fake Forex Funds: this is an increasingly popular method. Scammers assure you a huge return on a low-risk investment. They use the fact that Forex Funds are a popular product and one that’s legitimate in many regions. They then create a fake fund, provide you with financial quotes, large annual returns, and referrals. In many cases the funds lose money — the scammers work the system by never investing your capital.
