Forex scams are trading scams that include a trading scheme which I normally used to defraud traders by manipulating them and convincing them that they will receive a huge profit by trading in this Forex market. Since the Forex market has developed there has been a sharp rise in all types of Forex scams. This market gas attracted several scammers, fraudsters and fake forex brokers to come up with new ways to scam and manipulate people.
Since the market is unregulated and has no government or financial institution overseeing the exchange, several types of crimes take place. There is an enormous amount of money that floats in this market that is traded instantly. There are over the counter exchanges with no accountability since the market is unregulated and this allows scammers to earn fortunes in a limited amount of time.
What are the different types of Forex scams ?
1. The signal seller scam
This is a very popular type of Forex scam which includes signal sellers which are mainly retail firms or individual traders that offer a fee which is either daily, monthly or weekly. They claim to know the favorable times in which they can trade currency while offering huge sums of money since they claim to make anyone wealthy.
They manipulate and trick people by praising their trading abilities, customer reviews and all the wealth that they have generated. These signal seller scammers take money from people and scam them. However, some might be reliable only to perpetuate further scams and widen their scamming range.
2. Robot scamming
This is yet another persistent scam and this involves scammers touting their trading skills to make you wealthy while you sleep. The new terminology for these scams is robot scams since the scamming process is automated with technology. The robots scam Forex traders and hence these forex robot systems must be examined before investing a huge sum of money into the market.
3. Guaranteed returns scam
This is the most common and not so subtle scam yet many people still fall for this scam. The customers are primarily encouraged to join a service or a company with the promise of earning periodic profits. This is a complete scam because the forex market is dynamic and hence estimating profit and losses isn’t possible. It is impossible to generate guaranteed profits from the forex market.
How can you avoid them?
1. Avoid any quick profits
This is the number one tip I can give you and that is to avoid any quick profits. Do not fall into the scam of getting wealthy overnight since it takes time, effort and knowledge about the trading market to actually get profits. Whoever says you’ll get rich immediately is a possible scam so avoid investing with such people and companies. Fundstrace is an excellent website that allows you to gain more knowledge about forex trading scams and how to avoid them. They specialize in enhancing the knowledge of forex beginners so do check their website out before you invest!
2. No contact or background information
Avoid falling for any company or trader that has no background information. If any trader is reluctant to give their contact number and address that’s a major red flag so please avoid such scammers! Always search the background and contact information before investing.
3. Guaranteed success
This is yet another scam similar to guaranteed profits. The forex market is a highly dynamic and rapidly changing market fence guaranteeing success overnight or for a periodic time being impossible. If you truly wish to gain profit from forex you need to invest sensibly and you’ll need to wait. Nothing happens overnight!
There you guys have it, now you know all about the many types of forex scams and how to bounce back from them!