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AML Compliance or Theft?

AML Compliance or Theft?

I’ve been a member of the FPA for a long time. I’ve seen some strange reasons used by forex brokers to delay paying money owed to traders, but this one is new.

FPA member Ahmet Faruk Arapogla deposited US$4300 into his trading account with AlmaForex. His trading went well and he made a profit of over $6000. Everything was fine, until he tried to withdraw $8000 in April of 2009.

That’s when things started getting strange. Alma Forex told Ahmet that the $8000 withdrawal was processed and then rejected by one of the banks involved. Instead, his $4300 initial balance was returned and he got cryptic messages like this:

Alma Forex reserves the right to refuse to process a transfer at any stage, where it believes the transfer to be connected in any way to money laundering or criminal activity. Alma Forex is prohibited from informing a customer that they have been reported for suspicious activity.

OK, I could almost buy that. Holding a transfer while criminal activity like violating Anti-Money Laundering laws is checked seems reasonable. Almost, but not quite. If Ahmet was really suspected of some sort of crime, why would they give back his initial balance instead of just keeping his profits?

AlmaForex’s Support Manager, Nicholas Avlydis informed Ahmet that their investigation would take until July 21st. Despite the statement Alma Forex is prohibited from informing a customer that they have been reported for suspicious activity, he wrote:

Our Risk Department have been recommended to suspend our service for you as our client.
The reason is that at present moment any payments from/to your account fall under the scope of Anty-Money Laundering Policy. Therefore we are forced to refuse you our service and refund your payment.

I guess he didn’t actually say whether or not Alma Forex actually reported Ahmet for anything. Still, the fact that there was supposed to be a suspicion of illegal activity makes returning the initial balance nonsensical. Are we supposed to believe that it’s ok to hand back the original balance if someone is suspected of laundering the money or being engaged in other illegal activity before verifying potential criminal activities with the authorities?

Ahmet was told that the risk department would need until July 21st to decide if his profits could be returned. The money was originally deducted from his account on April 20th. What kind of AML check would take 3 months?

Ahmet did the right thing. He kept trying to get his money back through direct negotiations for over a month before bringing this to the FPA’s attention. Then, FPA Investigator Gerard took the case.

Gerard exchanged a number of emails with Nicholas Avlydis about the issue.. Nicholas claimed that AlmaForex once “had a very negative AML experience” and now uses an externally supplied database for AML issues. Supposedly, Ahmet’s name showed up in one table of the database, but in one of the lower risk categories. Now, AlmaForex was waiting for the next database update.

Just to make matters more ludicrous, Nicholas told Gerard that the database provider was confidential, so there was no way for Ahmet to contact them directly to see if he could clear his name. Also, he claimed that AlmaForex had no way to expedite the issue. Repeated requests for information on what regulator AlmaForex was under were ignored. I’m sure you can draw your own conclusions about what that means about AlmaForex and regulation.

So, what we have here is a company saying “We can’t give you your profits (but can give you back your initial balance) because some SECRET database says you MIGHT be a money laundering risk and it only updates every few months. There is no appeal and no way to speed this up. Have a nice day.” This is about as silly as when Senator Ted Kennedy kept having problems at airports since “T. Kennedy” was a name on the TSA’s No-Fly List. Interstingly, Ted Kennedy’s real first name is Edward. I appears that “suspicious person” lists apparently don’t need to be completely logical.

Let me share the Secret Pharaoh Method of showing that Ahmet isn’t a money launderer. He didn’t more than double his account by trading nanolots with a 20 pip stop loss. He did some serious trading and took some risks along the way (I hope he’ll be kind enough to share a little about his trading strategies here in the forums). Someone looking to break AML laws wants to move money from one place to another so it can’t be traced while losing as little as possible along the way. If you are a really good forex trader who can consistently make profits, there’s no reason to engage in money laundering. If you are a money launderer, you wouldn’t be taking large risks trading forex. You would instead take some very conservative, low-risk trades just to show some account activity while arranging to be able to withdraw the money into a different account from where it started. Oh wait, I take very conservative, low-risk trades. Guess I’d better never change my bank account info with my brokerages or I’ll end up on a secret list somewhere.

I’m not sure if Ahmet changed accounts or not. If not, then this whole process is insane. If he did change bank accounts, it should be easy to verify with both banks that he’s the true account holder and to inform both banks of all transactions, thus ruining the possibility of any attempt to secretly transfer money from one place to another.

Nicholas did offer to have an AlmaForex representative meet live with Gerard or another FPA representative in the USA to show him this super-secret confidential data. Gerard explained to him that FPA policy is that all scam investigations are handled by email. This makes sure that there’s a complete written record of everything that’s said. This also greatly reduces bribery attempts and personal threats against the FPA and its investigators. Gerard said he’d be happy to look at any documents sent by email and would keep them confidential. Nicholas refused. Of course, I can’t see how showing a printout of some list that has Ahmet’s name stuck in a some sort of risk category would explain why the database provider was incapable of checking out individual names faster upon request or why there was no other way for Ahmet to pursue the issue.

My personal suspicion is that Ahmet was a little too profitable for his broker’s tastes. Throwing out statements about not being able to say if they were reporting him to the authorities or not, combined with returning Ahmet’s initial balance and an excessively lengthy delay in getting updated info could very well be a plan to try to discourage him from continuing to pursue the return of his profits. Even if he gets his money back, I won’t be sure if it was solely because this became public or not. Maybe Alma Forex has done this to other traders and has an idea about what percentage of them will take their initial deposit back and go away quietly. I hope I’m wrong about this, but it’s going to take something extraordinary from Alma Forex to end my suspicion that this could very well just be a plan for stealing profits from good traders.

Due to the claim from AlmaForex that this will be fixed one way or another on July 21st, I’m told that the FPA Scam Investigations Committee is holding back on a final ruling. At that point, if Ahmet finds himself in prison on AML charges, I guess AlmaForex’s people can pat themselves on the back and keep the profits. Otherwise, I’m told that the Committee expects that Ahmet’s money will be returned very or there will be a scam finding issued.

If Ahmet does end up in Gitmo or some interesting destination that’s surrounded by razor wire, I’ll happily apologize to AlmaForex. Otherwise, even if he gets his money, my opinion is that there’s something terribly awry with a policy that can seize an innocent trader’s profits for a period of 3 months with no way to appeal it. Even if this isn’t some sort of organized plan to fleece traders of their profits, it’s wrong.

Ahmet’s initial complaint to the FPA about Alma Forex

FPA Reviews and Ratings for Alma Forex

Gerard asked Ahmet if it was ok to turn over info to me for an article about this issue. Ahmet agreed, and Gerard gave me everything with all the sensitive info (email addresses, account numbers) removed. I’d like to thank Gerard and Ahmet for providing me with this opportunity to feed my writing addiction.

UPDATE: Ahmet remaining funds were finally returned to him in late July. AlmaForex.com went offline in early August. If the FPA hadn’t pressured AlmaForex, I personally doubt Ahmet would have received his money before AlmaForex disappeared.

 

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Pharaoh

Pharaoh

Pharaoh is one of the FPA's oldest members (he claims to be about 4000 years old, but we think he's exaggerating a little). He says he created the world's first trading pair (Cow/Goat) while ruling ancient Egypt. Although there are no archeological or historical records to support this claim, we can't find anything to disprove it. Although he's not as active at the FPA as he used to be, he still holds the highest post count of all FPA members.

We don't understand how he does it, but Pharaoh has an uncanny ability to spot scams faster than anyone else we've seen. He claims to have known a number of companies were HYIP scams just by their domain names and that each time an examination of the website proved him right. He's also famous inside Forex Peace Army for warning about Ponzi schemes, even ones run by large and well established companies. He's been in a number of threads trying to warn people away from active Ponzi schemes. In spite of the efforts of shills and those gullible enough to believe in free money to discredit his words, he keeps up the warnings. In each case, the company ended up either disappearing with all client money or being shut down by the authorities.

In addition to investigating scams, Pharaoh has written a number of articles on a wide rage of trading topics, including forex broker selection, risk management, and how to select a good account manager. He's also covered other items of interest to traders, such as protecting wealth and purchasing precious metals.

Pharaoh claims to be a business consultant, but says he makes most of his income by running a globe-spanning hamster smuggling operation. If we are to believe him, he's currently working on a network of hamster tunnels under southern Europe.

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Comments

ahmet faruk arapoglu
9 years ago,
Registered user
Thanks

Thank you very much for the interest and help for this issue.

I also waiting help for reporting this company to interpol or complain them to Seychelles authorities and sue them for this fraud activities in order to prevent other victims to lost their money and also to me for getting my money back ...
MidasFX
9 years ago,
Registered user
Thanks for the report Pharoah.

BTW could you please check the fraction definition you give for nanolot in the Traders Glossary .
========================================
A nanolot is 1/10 the size of a standard lot. One nanolot would be 100 units of the quote currency ($100 for xxxUSD pairs).

For nanolots of xxxUSD pairs, a one pip move is worth $0.01 (1 cent).
=====================================
A minilot is 1/10 the size of a standard lot. One minilot would be 10,000 units of the quote currency ($10,000 for xxxUSD pairs).

For minilots of xxxUSD pairs, a one pip move is worth $1.
======================================
iztok
9 years ago,
Registered user
> Thanks for the report Pharoah.

BTW could you please check the fraction definition you give for nanolot in the Traders Glossary .
========================================
A nanolot is 1/10 the siz..

Nice work MidasFX. I also have some probleme to "understand" that.
Dezo
9 years ago,
Registered user
lot size

1 lot $100.000.00
mini lot $10.000.00
micro lot $ 1000.00
If there were nano lot sizes it would be $100.00 Dezo
Hahed1
9 years ago,
Registered user
Almaforex: in case you would have thought your client Ahmet Farouk Arapolaga and us soldiers at the FPA learnt forex trading behind the classroom and under the tree and could not even distinguish very clearly between night and day, you had better start thinking twice and release all his entilement within the shortest time possible because the battle line for the war to have his money back against almaforex is about to be drawn here on this platform!

Believe me we passionately need all his monies be refunded to him and let me warn you just avoid committing the mistakes instaforex did and now they are almost out of the market!

From the facts of this matter all your fictitious claim of money laundering agaist Ahmet are just a "forlorn hope" trying to make up evidence of " suspicion" which at best is never a proof under any law! this is a wild goose chase that will end up in flogging a dead horse!

you may think you could scare him away but he is not and we are with him and shall always be with him toe 2 toe in this struggles! release his monies before we just see you around latest monday !
Pharaoh
9 years ago,
Registered user
Ooops - I did have a typo in Nanolot. The $100 was correct, but I said 1/10 of a standard. What happened was that I copied and pasted the definition of minilot and missed one of the 2 items I needed to change. Its fixed now.
:embarrassed:
bvfx
9 years ago,
Registered user
There's your problem...

folks,

Seychelles....there's your problem right there!
unless you live there, and can pay them a "VISIT", what do you think it's going to happen?
ask yourself this question;
say you're at the airport, a guy from Seychelles, asks you to lend him $1000 for a plain ticket because his wallet was stolen, he shows you his passport, drivers license, etc (all from Seychelles). he promises, he'll give you $1500 back when he makes it home. his family is very rich he says... he's liquid!
Would you lend him the money?
Folks these brokers aren't even regulated, and the little regulation they have -the officials in these "countries" are very corruptible.

so think, USA, CANADA (your money actually insured), UK, SWISS, when picking a broker, even then, go for the ones who have been around for a few years with a track record. that simple!
oh yes, a few cents on a spread or $200 signing bonus is going to make it a great broker...what difference does it all make if you cant get your money?

just my 2cents!

good trading to all.;)
trendcat
9 years ago,
Registered user
g0od job pharoah investigating the broker

people have to wisen up,better sending your money to gain ,fxcm gft and the big brokers the world knows than send your money to these bioler room scammers
i know probable even gain and fxcm manipulate the price feeds,but hey at least when you cash out you will get your money
cheers
Ken Long
9 years ago,
Registered user
I think Ahmet has the right idea about contacting the authorities. I dont know how much help they can actually be with an unregulated broker located out in the Seychelles, but at least he'll have followed up on the problem himself and win or lose he'll know where the lines are drawn and then be able to make a better informed decision next time.

Overall though, I have to agree with bvfx. What do you expect when your dealing with a bucket shop off the far side of Africa? If you want acountability, its readily available. If you choose to use an unregulated, obscure broker you should expect these kind of problems. And this is my general feeling across all of these scam investigations. If you want to investigate bucket shops and attempt to bail out the unfortunate fools (I dont use this term to be discriminate or rude. I use it to be factual, and I apply it to myself as well. Entrusting ones money to one of these brokers is a foolish thing to do) who where taken in by them, all the power to you. There will never be any lack of either.

While we're at it, I think you should start off every one of these scam investigations by asking the complainee, "why they chose to place their money in an obscure bucket shop, rather than a large regulated broker?", when plenty of them are readily available, and "why they think you should be working to bail them out?".

I'm sure there are some honest people out there who just made some bad decisions, but my experiences with the tradable markets says that, there are just as many schemers on the retail side of the fence as there are on the broker side, and nothing happens without a reason. Ultimately, we are all responsible for whatever happens to us.
FPA Investigations Lt 2
9 years ago,
Registered user
While we're at it, I think you should start off every one of these scam investigations by asking the complainee, "why they chose to place their money in an obscure bucket shop, rather than a large re..

LMAO!!! I might need a new job if that rule went into effect.

I find offshore brokers easier to deal with. Those that reply to emails come up with strange things like Alma Forex does or they decide to negotiate seriously. Many cases are resolved very quietly. Regulated brokers frequently decide to hide behind the NFA and won't discuss things openly.

Nicholas finally told me his version of why he could pay out the initial balance. This still doesn't explain why he's holding onto profits. He said...

"The database we work with has about twenty risk categories. For each of them there are list of possible actions. In case of Mr. Arapoglu’s
category we have made maximum what we could – repayment in full."

He's saying that Ahmet's suspicious money can be returned in full, but gives no reason why the profits made with this money can't. I would think that the suspicious money would be more likely to be confiscated under AML laws than profits made using it.
bvfx
9 years ago,
Registered user
True

> I think Ahmet has the right idea about contacting the authorities. I dont know how much help they can actually be with an unregulated broker located out in the Seychelles, but at least he'll have foll..


..."Ultimately, we are all responsible for whatever happens to us"
That's the most truthful thing in life. i realized that a few years back, and changed my life. every bad thing that happens, you can pin point the exact moment in time when YOU made the wrong decision.
Nihari
9 years ago,
Registered user
Seychelles - acrooked place

> folks,

Seychelles....there's your problem right there!
unless you live there, and can pay them a "VISIT", what do you think it's going to happen?
ask yourself this question;
say you're at the ai..

I have travelled the Indian oceon 8 times stopping at Seychelles for a day. In those days, 50 years ago, it was considered the crookedest place in the world.
khalihgs
9 years ago,
Registered user
It is a really innovative way of excusing! Very novel! The deserve a Nobel Prize for scamming!
Hahed1
9 years ago,
Registered user
cmrades in arms: can somebody tell me why almaforex cant be declared thieves, fraudsters, liers, scammers and cheats? Of course they since they haven't yet come on board and tell us convincingly what happened to Ahmets profits from his trade and why they genuinely withheld that!

I urge you all to boycott trading with them and withdraw all your monies with them and tell all not to invest with them because they are fraudsters and and scammers untill they come out on this forum to clarify why they have decided to steal Ahmets' trading profit and gave him stupid excuses of money laundering in which case its they who ought to be investiagated for that!

I think we need not go further providing any material evidence to establish fraud, lying and thievery on almaforesx deals!


Almaforex we are waiting for you to come and tell us one or two nonsense excuse for depriving Ahmet of his hard earned profits!
SAMMYFX
9 years ago,
Registered user
Nice Piece Pharoah

Thanks Pharoah for this piece! The situation is very alarming. I have a question for this broker- IF AHMET HAD MADE A LOSS LEAVING HIS CAPITAL TO NOTHING WOULD ALMAFOREX RETURN HIS INITIAL CAPITAL BACK BECAUSE OF SUSPECTED MONEY LAUNDERING?
Their excuse does not hold any water!
Scam Investigations Committee
9 years ago,
Registered user
Ahmet finally got his money back from Alma Forex this week.