The FTC reported that approximately 77,000 traders fell victim to forex scams in 2022, resulting in reported losses of around $1.3 billion. Avoid falling victim to these scams by opening a trading account with IG Group.
Every day, around $6.6 trillion in currencies are traded worldwide, leaving a huge window for profits for professional and amateur traders alike. On the more infamous side, the quick riches forex trading has brought to some has encouraged many to fall for scams promising just that. It’s not surprising, considering that trickery has accompanied money-making industries since the dawn of time. What comes as a shock is how long those scams go on before the authorities bring them to justice — or at least attempt to.
The U.S. and Canadian governments recently took decisive action by shutting down My Forex Funds on accusations of fraudulent activities. The company allegedly employed a multitude of tactics and system manipulations to deceive its users, depriving them of their winnings. Additionally, it was found that the company had acted as a trade counterparty despite claiming otherwise. All of that brought the company $310 million over the three years the ruse took place.
Still, My Forex Funds pales in comparison to some of the scams in the forex space, particularly the notorious case of OneCoin. The cryptocurrency, which was designed by crypto scammer Ruja Ignatova to be an improved version of Bitcoin, included an app with an integrated trading feature that served as an additional revenue stream for the company. The entire operation turned out to be a $4 billion fraud that persisted for nearly five years. Ignatova managed to evade authorities, and her whereabouts remain unknown.
Before OneCoin was founded, Evolution Market Group already had its operations shut down by governments around the world for misappropriation of users’ funds. On the surface, the online trading platform appeared to be a legitimate broker, but behind the scenes, it managed to swindle more than $600 million from its users. It took years before the orchestrators were apprehended.
Why does it take so long to initiate prosecutions against scammers who often knew what they were doing from Day One? The reasons are many, but some are more apparent than others. To bring charges, prosecutors must gather extensive evidence indicating criminal activity. Collecting this evidence often necessitates hundreds of hours of meticulous investigation.
The novelty of the securities that such malicious companies sell can provide them with ample leeway before government regulatory bodies are established to oversee them. The process includes obtaining top-level approvals and recruiting and training personnel capable of effectively curbing fraudulent activities.
Legal defense strategies that the scammers use in anticipation of prosecution also play a major role in impeding charges against them. Because their operations often span the globe, they can establish their companies in countries with high levels of corruption and weak institutions, further complicating legal proceedings.
In the end, it is the victims of these scams who suffer the most. They frequently struggle to recover their funds, and even when they do, it’s often only a fraction of the principal amount. For these reasons, among others, selecting a reputable broker for trading is paramount.
Started in 1974, IG Group is a multiasset broker that holds more regulatory licenses than any other trading platform in the world. IG is a publicly traded company that has undergone various screening procedures to earn its ticker.
In addition to contracts for difference (CFD) and forex trading, IG offers world-leading research tools, educational resources and an array of tradeable markets catering to both experienced and novice traders. IG offers access to 19,500 tradable assets for its users. Before committing real funds, users are encouraged to gain hands-on experience using IG’s demo account, where they can practice trading with $20,000 in virtual funds. If users decide to transition to trading with real funds, the minimum deposit requirement in the U.S. is $300.
Check out Benzinga’s favorite options for forex trading accounts.
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securely through Forex.com’s website
Best For:
Forex Trading in and Outside the U.S.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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Securely through Interactive Brokers’ website
Best For:
Active and Global Traders
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securely through HYCM Capital Markets’s website
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