Characteristics of Forex Brokers Scam And How To Avoid It

The characteristics of a forex scam broker and how to avoid it, if you are a forex trader, choosing the right forex broker is a must. Previously we also discussed about several types of scams in the forex trading business and maybe you need to read them first about scamming itself especially in the forex trading business. Forex brokers are said to be scams because they are cheating on their customers, how? there are so many ways that forex brokers can do this. If you want to know more clearly, please continue reading it.

Some things that can make forex brokers said to be cheats is to charge a fairly high spread to its customers. The amount of spread on normal market conditions among forex brokers is around 2-3 pips, but the forex broker who runs fraud can give a spread of 7-8 pips per trading position. If the forex broker charges a very large spread every time a forex trader opens a forex trading position, then how much profit in units of pip is obtained by the forex broker.

The characteristics of forex brokers are said to do scam actions because he applies stop hunting.You need to know that all forex brokers know where we put up a forex trading stop position. And sometimes they run our stop position so that the position we open is closed, which means closing the forex trading position is not due to the market price but because the forex broker did it. And usually forex brokers who practice like this are forex brokers who trade not through the real forex market or said that the price formed is the price of the forex broker itself.

The third characteristic is that the forex broker is usually not officially registered in his country so that it can be said that the forex broker runs a forex trading business, especially illegal or unofficial brokerage. There are so many illegal forex brokers that roam the virtual world that it is necessary to be careful about forex traders to always do research first before choosing it as a place to run the forex trading business.

So that we avoid a forex broker scam then we must first examine the forex broker, whether he has obtained permission from the local government regulator or not. And to check actually is very easy, for example if you want to use a forex broker registered in the United States, then you can check it through the Commodities Futures Trading Commission (CFTC) and the National Futures Association (NFA) by checking it directly through the website owned by NFA. And then enter the NFA ID Number owned by the forex broker into the search engine.

If it turns out your forex broker is not registered in the NFA member then you must be careful. And our advice is to please you stay away from the forex broker!

Lots of forex brokers who claim that he has been regulated in a particular country and this happens very often. So if you are in doubt about the preferred forex broker, then please check the license number he has entered into the list of regulations that he conveyed to his customers. If you can’t find the license number because it is not listed, you must be careful and even stay away from it, but if you are still unsure, then please ask the relevant regulator directly by telephone or face to face.

In addition to checking directly through regulators, you can also ask through forums that discuss scam forex brokers. don’t be shy because if you are embarrassed you can lose your capital without a trace …

If you want to know about a brokerage company that is not listed on the CFTC then please visit the website directly and try to understand about the list of forex brokers presented here whether the forex broker is your choice including CFTC members or not.

And if you know about fraud that occurs in the US then you can make a complaint through:

CFTC: http://www.cftc.gov/ConsumerProtection/RedressReparations/index.htm
NFA: http://www.nfa.futures.org/basicnet/Complaint.aspx

That was how to see if a forex broker in the US had an official permit or not or had been officially registered with CFTC and NFA or not. Then how do you check whether the forex brokers in the UK, Switzerland, Denmark, Hong Kong, and Australia really have obtained a permit or not then we can check it directly through the regulator of each country, it’s easy right.

If you want to use a forex broker in the UK then you can check it at the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA). And please do your complaint via http://www.actionfraud.police.uk/ if you find fraud in the UK including scam forex brokers.

And if you want to use a forex broker registered in the country of Switzerland then you can refer to regulations issued by The Federal Department of Finance (FDF) and the Swiss Financial Market Supervisory Authority (FINMA).

And if you want to use all brokers in Hong Kong, then please refer to the regulations that they have through the Hong Kong Securities and Futures Commission (SFC).

If you want to use a forex broker registered in the country of Australia, then please refer to the regulation he has through the Australian Securities and Investments Commission (ASIC). And please do your complaint about all forms of fraud that occurred in Australia including about forex broker fraud at,
http://www.scamwatch.gov.au/content/index.phtml/tag/reportascam#h2_10

And if you want to use a forex brokerage service in the Danish country, then please refer to the regulation that he has through the Danish FSA .

So in essence if we want to avoid being called a scam then the thing we have to do is study and research more deeply about various types of scams that can occur in the forex market and I am sure that you can avoid being called a scam if you always deepen your knowledge about the forex trading business and do not be too confident with other people who say it can help you to be able to successfully run this business, especially if they give sweet promises to you.