Avoid being Scammed by a Forex Broker by doing some research
When you are looking to start trading forex, indices, or commodities it is important to do your research and learn how to identify forex broker scams. A quick internet search on scam forex brokers will send shivers down your spine. It’s shocking!
The bottom line is to do your research properly to avoid being a victim of one of these scams. It is important to identify brokers that are reliable, viable, and regulated; and to avoid the ones that are not. Before depositing a large sum of money, you must go through a series of steps.
Fact from fiction
If you only look at forum posts, articles, and review websites on brokers, you will think that all broker companies are scams or that all their traders fail and never make a profit. These types of traders that fail to make profits will post it online and blame the broker for their own failed strategies.
Traders mostly complain about the fact that the broker was intentionally trying to cause a loss; in their opinion. These types of complaints are common among traders and most of the time it is not the broker’s fault.
The biggest thing you as a trader can do to make sure you are dealing with a legit broker; is to always keep the communication channels open. The communication between a broker and a trader should never break down. Clear red flags and warnings are not receiving responses from your broker or when your broker is giving you vague answers.
Conduct Research to protect yourself
- Do online research on the broker you are looking to use. Start with a generic internet search like “scam forex brokers” and see what pops up. Read our articles on Forex Brokers.
- Make sure there are no complaints about not being able to withdraw funds.
- Read through all the fine prints and documents that are available online on the brokerage.
- Make sure the brokerage is regulated (FSCA, Cysec, FCA).
- Call the broker and speak to an account manager.
As an authorized financial service provider, it is very important to maintain your license. Verify that the financial services organization can operate in South Africa by visiting the regulator’s website at www.fsca.co.za, or call their toll-free number 0800 110 443.
If you are satisfied with your research, open a standard account, and deposit the smallest amount of capital possible.
We’ve vetted a number of forex brokers who operate in Africa and can assure you that Khwezi Trade (a division of Khwezi Financial Services FSP 44816) follows all the required procedures from The Financial Services Conduct Authority (FSCA).