New Fx Broker Scam Strategy!!!

[gbenga112]

Statistically about 80% of FX trader loses while about 20% wins,going by this statistics,I observed that there are various fake brokers out there just to scam traders.These brokers simply use all means and bonus promises to persuade trader/investor to open an account with them.Once this is done,every trade the trader opens are not actually or really executed (Just like trading on demo) but it will show on there useless platforms that the trade has been opened since they believe that the majority of traders loses money.
With this the trader would not be able to detect they are scammers,the trader will believe he/she actually lost his/her money in his losing trades whereas no real trade is actually made(that is the trader is just paper/demo trading).
The only problem this useless bunch of criminals encounter is where the trader actually made profit,they simply frustrate and refuse to process withdrawals,and when they realises the game is about to open publicly they refund the initial deposit of the trader and refuses to process the profit withdrawals. Some of these useless bunch of criminals need to be expose by all means. Dont keep mute if you notice anything shady about your broker so that fellow trader could learn from your mistakes.

Please fellow traders,research extensively before opening account with any brokers,make sure they are not using a forward mail address,they are regulated and dont just believe what they say about themselves or claiming to be regulated,please make sure you cross-check with the supposed regulated body to make sure the info is accurate.

Best of luck in your trading!!

 

[Babigau]

Scam Strategy

I have been having similar thoughts. Think about easy would it be to set this up? With the right platform this is far far easier than handling actual trades.

Online Casino's:

What you are describing fits in well with the strategy and operation of an online casino. These companies make their income on the basis of deposits they receive, and expenses include withdrawals. Bonus incentives, upsell rhetorical strategies and so on.

Notably, when you enter an online casino in the long run you expect to loose money. Few leave with profits. Of course a legitimate online casino (such as Casino Tropez, etc) will pay out on profits.

Online Forex Broker:

The broker i have spoken with states that they do not make money from anything else other than the spreads. Thus, in a direct sense they should not be too concerned about deposit size. Indirectly they have some interest in your deposit size as it relates to your volume and perhaps frequency of trading, and thus income to the broker through spreads.

You can see how this is very different from an online casino, which the income comes from the deposits directly, and withdrawals are part of expenses.

Deposit only 'Forex Casino' ?:

The way you write that suggests to me that your scam strategy idea is aligned with the strategy and basic operation of an online casino. That is to retain deposits and minimize withdrawals. I.e. encourage loss to minimize withdrawal, and minimize withdrawals through not processing withdrawals for any possible reason (claims of fraudulent trading, trading abuse, deleting 'off market' profits, whatever).

In this scenario there are two main scam elements;

1. The deception that the 'forex casino' is a legitimate forex broker.

2. There is a deception in that withdrawals will be processed and that profits will be paid out, where this is not the case.



What do you think? Or do i need a little more hours of sleep per night?

 

[Pharaoh]

It's not a new strategy. It's called a bucketshop. Those have been around for decades before over-the-counter forex trading existed. Most stock traders also lose money, so bucketshop brokerages accept buy and sell orders and fail to pass them on to the market. There are bucketshops for just about anything that can be traded.

Naturally, bucketshops hate successful traders, since those successes cost the bucketshop money.

 

[Babigau]

I sense you are an expert. Thanks for clearing that up.

I did a search to see if FPA had a terminology wiki or whatnot and stumbled across your article. Excellent work.

Aside from feedback on the FPA forum, recommendations from those you trust, company partners and affiliations (NFA, Oprah, etc..) it seems hard to be confident that any forex broker is passing on orders to the market (wherever possible) until sufficient smooth trading and relatively large withdrawals (if you are successful) with that broker has been experienced.