These fraudsters use foreign IPs and purchased websites to commit fraud, and when the time is “right”, they run away with the funds of their clients. The first lesson in forex trading is not about making money by trading, but learning about the steps to not fall into such traps.
Sometimes, it is not that novice investors do not check the authenticity of the platform, but they are brainwashed by the trusted “netizens” or “investment teachers” and unconditionally believe their words. In life, it is not unusual to see betrayal cases by close friends, loved ones, and family members, let alone a stranger from the internet.
The first misconception about “investment mentors” in the FX industry is that a real mentor is there to teach you how to fish, not feed you the fish on a silver platter and right to the front of your face. The real investment bigwigs do not care about being famous or staying high profile for touting attempts. If you ever come across someone like that, be aware of that person. Ask yourself, “what does he gain from telling me what to trade/giving me advice for free？” That shall put things into a much clearer perceptive.
The second misconception is “enthusiastic netizens”. We have all fantasized about getting rich overnight, but that dream is ultimately a dream – money does not grow on trees, nor in your dreams. However, many still fall for that “internet friend” who randomly sent them a text message and then introduced them to forex trading with a guaranteed % of profit every month.
This is a real life case reported by a trader on WikiFXs exposure page: https://www.wikifx.com/en/newsdetail/202206169574715862.html
Why do some foreign exchange platforms are said to be fake？ The reason is that many fraudsters use this business as a shield for their illegal fund-raising activities. Such brokers usually sugarcoat their true nature with a professional-looking website alongside one or two regulatory statuses and/or licenses, where their registered business premises is often located in third or fourth-tier cities. From time to time, they will organize meetings with their trading clients, offer free forex trading workshops, and so on. It is hard for an average trader to identify such brokers because they disguise themselves as a legitimate forex brokerage firm.
Generally, these illegal fundraising forex platforms are maintained through the recruitment of new members or through continuous deposit from existing clients. This is a form of pyramid scheme to keep the business going and the customer (or rather, victim) base growing. Eventually, such platforms will go bust and the trading clients who have accounts and funds with them will be left with nothing.
If you have learned how to stay away from these 3 groups of people/organizations, the next step is to choose the right and compliant forex broker for yourself. If you already have a preferred broker, look it up on WikiFXs mobile application, which is free for download and use at both Google Play/App Store.
For desktop users, log onto www.wikifx.com.
You can check all relevant information regarding any forex broker in question on the WikiFX website and app because we collaborate closely with 30 national regulators in providing verified background and regulatory information of over 36,000 forex brokers globally. Remember, checking the reliability of your forex broker is always the number 1 step that you should never skip.
On the other hand, if you have no specific forex broker in mind, you can also utilize our free functions for your convenience, such as choosing brokers that are regulated by your local regulatory body or picking brokers from the top of WikiFXs ranking board.
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