Be Aware of Forex Trading Frauds - February 18, 2008
Forex trading is lucrative. Since there is not exactly a central governing watchdog, it can be subjected to forex trading frauds.
It has been reported that most fraudulent cases are committed by firms in South Florida, Southern California or outside the US. In 2000, Boca Raton was voted by CNBC as the telemarketing fraud capital of the world. Russia at this moment remains the major source of investment fraud.
There are a few handy tips to avoid becoming a victim of such frauds. No amount is too small for the fraudsters. Do not encourage their activities by being easy victims. Help fight them.
1. Never ever write a check or bank wire payable to anyone other than a FCM registered with the National Futures Association (NFA). Ignore all kinds of reasoning to do otherwise.
2. Check to see if the broker is registered with NFA (800) 621-3570. If you are dealing with brokers registered in other countries, be sure to check with the government regulatory body to verify the authenticity of the business.
When performing a check with the NFA or other watchdogs, make sure that their licenses are active and there are no negative complaints filed against these people.
Many Forex frauds are perpetrated by firms in the US and the principals and brokers of the firm were once registered with the NFA but have since had their licenses revoked.
Doing a quick check like this can save you from losing your investment and falling prey to forex trading frauds.
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