Online Forex (FX) Trading | Forex Brokers | Foreign Exchange Market

Thursday, 10 May, 2007 saw the Forex supervisory bodies (CFTC), Commodity Futures Trading Commission and (NASAA), the North American Securities Administrators Association join hands to run an investor alert and warn the current as well as potential traders and investors about the dangers of trading Forex.

A lot many novice traders are easily lured into Forex trading market, and alongside, also into the Forex trading frauds.

The first and the foremost thing that the supervisors warned the individual traders against was the Off-Exchange Forex trading. They termed it as an extremely risky trade which had a high rate of fraudulent intentions to it. 

Mr. Michael V. Dunn, presiding over of the CFTC’s Forex Outreach and Education Task Force was of the opinion that, “The amount of destruction which the Forex frauds have caused to the victim traders and investors is substantial. Anyone trading or planning to trade Forex and has an internet access 24 hours at his place, is a potential target to such fraudulent Forex websites”.

He also added that while the CFTC, NASAA and other Forex supervisory bodies are working hard to stop Forex scams and frauds from occurring, the most important step to shielding an investor from being cheated of his money is an educated and well verse investor himself.

Forex websites or shops with fraudulent motives attract customers with classy and refined offers which can be easily seen being advertised in the daily newspapers, television and of course, the Internet.

These scam artists promote themselves and their company by offering lucrative and too good to be true trading offers, wherein they promise to offer the highest leverage ratio in the market along with huge and guaranteed returns on investments over a short time, with little or no shortcoming or risk involved.

The CFTC and NASAA have now come up a list of caution signs which the traders should look for and cross check before investing in any Forex opportunity. These caution signs include:

            1. Guarantees which may sound too good to be true, like the instant-success or overnight-rich schemes involving Forex trading. There is a high chance of these promises to be scams and frauds.            

            2. Unknown phone calls or emails offering various lucrative Forex investment schemes, especially from unfamiliar and unknown sales executives or companies.

            3. Use of hard selling or aggressive marketing tactics and efforts in convincing you invest your cash instantly to an unknown Forex firm through Internet for getting double the money next day.

Joseph P. Borg, Director of the Alabama Securities Commission and President of NASAA, is of the opinion that “Forex trading isn’t for everyone”. This is because not everyone is made for the investment and business world, so if you cannot figure out how it works in the Forex world, do not invest. Knowledge is the most important tool to keep you safeguarded by these frauds and scams.

The CFTC’s Division of Enforcement has set up a toll-free telephone number to help people in reporting likely violations of the commodities laws: 866-FON-CFTC (866-366-2382).           
You can also visit NASAA’s website at www.nasaa.org to contact your state or provincial securities supervisor and report any fraud or scam case.

 

This entry was posted on Friday, May 11th, 2007 at 12:28 pm and is filed under Forex News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.