FSCA or the Financial Services Conduct Authority, has put the forex trading returns of various unscrupulous individuals in the limelight. They have put the public on notice to be cautious when dealing with these charlatans.
With so many forex trading cons emerging daily, the FSCA warned that there are con artists who pretend to be forex traders. They have also released details about two con men who are currently being prosecuted as they pretended to be forex traders.
The regulators’ first move was on Prophet Moral Monareng and Money Moves Forex. They warned forex trading beginners not to have any financial dealings with these two “so called” forex brokers. Prophet Moral and Money Moves used social media to advertise their forex services. They have also illegally used the fsp (financial services provider) number 48809, belonging to Lebone Risk Solutions.
The FSCA further said the two men had no connection with Lebone, despite claiming that they were. The FSCA also said that they were not authorized to act as financial services providers, nor were they to give any financial advice.
There was another conviction of one David Wilmot, hailing from Port Elizabeth, who took money from people under false pretense as a forex trader, claiming that he would trade on behalf of them. He used his company Nava Shore Holdings to swindle his clients out of their money.
The FSCA claims that Wilmot used his connections with a church, and exploited that relationship, in order to misuse the funds his clients entrusted him with in 2013. The forex trading regulators have given the public fair warning advising them that traders should never deal with Wilmot, because he is not a legal, financial services provider and does not represent either of the regulatory bodies. He is currently serving time on money laundering charges.
The sentencing and conviction of one Jabulani Ngcobo and Mzabalazo Dlamini, was also reported by the regulator, who under false pretense broke the forex trading regulations by falsely claiming that they can trade on the client’s behalf. The two have since been convicted with a six-year jail term. On top of it they also received a five-year suspension.
Scammers Versus Credible Forex Trading
Forex trading when legitimate, works on the basic principal of the rise or fall of a particular currency that the forex traders are trading on. The ThinkMarkets.com co-founder, Faizan Anees, has highlighted the number of rising scammers that may lure traders by using the tricks in the market.
Before making any kind of investment, it is essential to know that forex trading is not a get rich quick scheme. Thus, anyone offering a better deal that could double your money in a short period of time is a complete scam. He also pointed out that most established and legitimate forex brokers or forex trading platforms will never share the tips and tricks they used to earn big.
Faizan Anees further stated that you could save yourself from scammers by doing your due diligence on the bank or broker you want to deal with and checking their legibility. It does not matter how long a broker has been trading, what matters is their reputation. Getting a glimpse at their trading statements is a sure way to counter check before investing. Ask the broker for certified and signed statements to see if they are regulated or not.
People who put pressure on you are red flags and you should avoid them. Be aware of expiring opportunities that never come back. Always start small and don’t invest large sums of money. Any profitable strategy trader can always win with either big or small funds. There is no need to make rush investments. Besides you can always invest the amount you wouldn’t mind losing just in case. If you are just starting out we would highly recommend you to check out our reviews of the most secure platforms and choose your trading account wisely:
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- Plus500 trading experience
- eToro trading experience
- Avatrade trading experience
- Olymp Trade
Gambling and Forex: Would You Gamble With Your Retirement?
Every top or established financial planner will tell you that trading should only be done with an experienced or qualified trader. Forex trading is not different from gambling, which you know is addictive and not a wise decision to indulge in, unless your financial credentials are amazing. That’s according to Gradidge, with an investment company under his name and who is an established financial planner.
If you have enough money to see you through retirement, educating your kids, and have an emergency fund, then you are financially capable, says Gradidge.
Forex has a random outcome that can be compared with the roulette table’s betting on red or black. For most South Africans having a retirement package is a complete luxury. This leaves the qualification for financial independence to the selected few who can do forex trading.
Making money with forex investments is mostly done by those who sell training programs and those who have forex trading platforms. According to Gradidge, it is not easy for any average person or beginner to make a sustainable income through forex trading, but then again, the odds might work in your favour.
If you want to go as safe as possible than we would highly recommend you to check out the managed forex account investment options
Most forex scammers are easy to spot through their outrageous profit acclamations. Gradidge calculated that if the said returns were anything to go by, then you would become a trillionaire in just three years. These overzealous claims are irrelevant and are only directed at your vulnerability to make it in the forex trading world.
Before going for such huge promises, you need to re-think and do a background check on the said broker. You can do a check-up using the FSCA, to see if the broker is regulated or not. Making it in forex trading might sound farfetched, but what is important is how you trade and how you invest. Don’t make huge deposits that you will later regret when things don’t go your way.
Some charlatans misrepresent their FSP status, either by using a false FSP number or by claiming to be linked to or associated with a legitimate FSP. You can uncover this by checking with the FSCA.