Fighting back against Forex Scams

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Fighting back against Forex Scams
Fighting back against Forex Scams. Image source: Pixabay

Cape Town – 11 December 2019 – Based on recent media reports it may be hard to believe, but with education, discipline and caution, Forex trading can improve livelihoods and expand horizons. But Forex trading has been beset by stories of bad brokers and scams in recent years – which has done much to tarnish the reputation of the industry. The idea that Forex trading is gambling at best and scam at worst has become widespread across South Africa.

In a recent article, Craig Gradidge, a certified financial planner, stated that “the random outcomes in forex trading are similar to that of betting on black or red on the roulette table. There’s a one-in-36 chance that the green could come up in roulette, so perhaps forex is slightly less risky, as the currency could go up or down.”

The assumption must be that Gradidge is unaware that every major investment bank in the world has a currency trading desk, that dozens of hedge funds in every global financial centre rely on Forex trading to make vast profits. Whatever else you think of investment banks and hedge funds, we can all agree that they are very serious about making money and would not consider frittering away hundreds of millions of dollars on something with a “random outcome”.

But Gradidge is not alone in his beliefs, and this is something we need to rectify as soon as possible.

The solution to the problems facing Forex trading and Forex traders in South Africa is two-fold. First and foremost, there is a pressing need to ensure that new traders are suitably educated before they start trading, this is something that good brokers, and many others in the industry, have made a key goal over the last few years. TradeForexSA, on online broker comparison portal, have always done their best to shepherd new traders towards the best brokers in the world and provide them with the education needed to become a successful trader.

The second part of the solution is more difficult, and that is to remove the unscrupulous brokers and scammers from the market. With this goal in mind, TradeForexSA have launched a Report a Scam Broker service, where traders can report a broker or individual they feel cheated them. While there will be no legal recourse via this service, TradeForexSA will investigate all claims and post warnings for the trading community – to protect other traders from making the same mistakes.

Reports have been collected for a few weeks now and there are some disturbing patterns emerging, with some of the same companies involved in multiple complaints and the same methods being used by criminals to target their victims. We ask anyone who does feel like they have been cheated in some way to get in touch. While only the Financial Services Conduct Authority can close companies down or lock individuals up, we can at least attempt to stop bad actors from profiting from the ignorance of beginner traders.

Forex trading has the potential to provide a real boost for people’s quality of life, but bad brokers and scammers can turn that potential into despair and cynicism. The fewer bad brokers and scammers there are in the market, the better the chances are that South African traders can improve their livelihoods and expand their own horizons.

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