How to start trading on Forex and not become a victim of scammers. Tips from LST-IC
Modern banks have long since ceased to safeguard savings, with deposit interest rates tragically lagging behind inflation. All this pushes any reasonable person to the financial markets, where you can save and multiply your earnings. However, there they are ambushed by unscrupulous businessmen. LST-IC experts tell how to identify a reliable partner and bypass forex broker scams.
Meet on clothes
"The first thing to look at is the financial company's website. It should work properly and contain up-to-date information about the company's data: its address, postal and electronic contacts, and license details. And in general, it should be tidy. After all, a website for the modern businessman is like clothes, an office, and a showcase in the past. You wouldn't give money to an unshaven man without papers in the park if he said he was an investment manager," - says Jack Finley, a financial consultant at LST-IC.
Let's add that the website is not only a showcase but also a tool, especially for modern fintech companies. You may not only find a poorly functioning website from scammers, but also from others. But there is a risk of failure during a deal or withdrawal. It's better to get around it beforehand, just like a suspicious person in the park.
But one decent view is not enough. Be sure to check the license data, LST-IC advises. In the modern world, this can be done literally in two clicks on Google. Unfortunately, the websites of government agencies sometimes turn out to be not the most convenient - then you will have to make five clicks. Maybe seven or even ten. It's worth the effort.
What absolutely should not be on the website of a decent business is obviously deceptive inflated promises. No real Forex broker will promise guaranteed income, Finley notes.
"Trading, investments, bank deposits, even government bonds are always a risk. Risk can be managed, and there is hedging, and insurance – this is what you will hear from a real financier. We at LST-IC have an absolute prohibition on the promise of guarantees. It's unprofessional," he says.
The fact is that one's fear of loss is biologically greater than one's desire to acquire. And scammers take advantage of this by making false promises. After all, they have no intention of fulfilling them.
You should also avoid companies with clumsy websites, "fair" designs, or overly intrusive consultants. This does not appeal to the rational mind, but tries to influence emotions. It is also a sign of social engineering.
"Broker forex scammer will try to "plant an emotional harpoon", grab attention and engage in the scheme without letting you come to your senses," says MELIORATE consultant.
An honest business is interested in customers who are aware of what, how, and why they are doing. He works on building long-term relationships and values his reputation. It's better to lose ten clients, Jack Finley says than to gain one dissatisfied one.
Explore Sitename scam review
"Some experts believe that reviews have devalued in the modern world. It is too easy to put them online. However, we at LST-IC continue to consider it an effective tool," - Jack Finley continued.
The modern Internet allows us not only to disseminate information but also to verify it. Read what they write about the company you are going to work with, and then analyze these messages.
What should alert:
- If the reviews are written with a lot of errors
- If the reviews are of the same type and the search engine issues them as copied in various places
- If the reviews are signed with names from the Harry Potter book or taken from a popular TV show
- If the reviews are written in an extremely excellent or derogatory tone
- If the social media pages of the people who left the review are empty or filled with garbage.
Such reviews have the characteristics of being fake (although they are not necessarily fake at all!)
At the same time, pay attention to those that are written in lively language. There is a good chance of finding a grain of truth there. You can also look at the broker scam list.
"Еxamining comments and reviews, you need to be a little bit of a psychologist," says Neuman. – A bad review is left by a person upset about something. And you can try to understand what was the true cause of irritation. Maybe he confused himself or hoped for something impossible. A good review will be left by someone who was satisfied, and who wants to give other people the signal they need. But an honest person will always be critical. So even in a good honest review, there may be negative aspects. And vice versa."
Pay particular attention to negative reviews. Examine what exactly the company is being criticised for. It may turn out that the bad experience was not because you found a scammer, but because people bought bitcoin or pound sterling en masse before the big collapse. Analyse the dates and profile news.
And remember, people are more likely to leave negative feedback than positive. So don't let a little disbalance scare you. Watch what people complain about.
One of the favorite tricks of fraudsters has been and remains the creation of a "parallel universe". When it comes to Forex trading, this would be the creation of a platform where trading takes place in isolation from the real market, with fake bots trading instead of real players.
"Ironically, it is still possible to come across scammers who play up a 'masquerade' and show fake ones instead of real rate movements, ripping off their victims. A licensed company is a good broker and will never go for this, as such tricks are punishable. Scammers take advantage of the fact that there may not be enough officials to control everything that lives on the network, and the victims of scammers do not track small nuances," - Finley notes.
LST-IC advises you to check whether the quotes on your platform match those shown by the free services. If there are news services on your platform - how quickly do they show relevant news? Are there no dramatic differences from what is published by verified sources?
Yes, free services can publish data with delays, because stock market information itself is of great value. So it is worth following the platform without starting trading. Any major difference from what competitors are showing is a reason to ask the support team.
Undoubtedly, rates in different markets and on different platforms can differ, says financial consultant LST-IC. Finley points out that it is thanks to this century that inter-exchange arbitrage flourishes and many fortunes are made on it.
"But fluctuations do not arise by themselves. Usually, if the price of a currency or some asset is higher somewhere, then there are higher transaction costs when withdrawing funds and there are no convenient mechanisms. But in this case, it is observed constantly or for long periods of time. And the difference will correspond to the transaction price. And certainly, trends will not live in isolation from the rest of the world," the expert noted. – Therefore, if you see alarming signals, if the broker cannot clearly answer your questions – leave. There are enough professional services on the market and it's not worth wasting time even on suspicious ones."