eComms Scam – How to Avoid the eComms Scam

Often, unregulated forex brokers use different ways to persuade new traders to deposit money. They use tricks, promises, and fake websites to lure them.

One of the shady practices is that some brokers offer wide bid-ask spreads on particular currency pairs, which makes it more difficult to earn profits.

The legitimacy of the Forex Market

Forex, which stands for foreign exchange, is the world’s largest and most liquid market. Historically, it has been dominated by professional traders from central international commercial and investment banks.

However, the number of other market participants has risen significantly in recent years. This includes large multinational corporations, global money managers, registered dealers, international money brokers, futures and options traders, and private speculators.

Forex brokers must abide by a variety of regulatory requirements. For example, they must have adequate capitalization and conduct external audits on their activities. They also must have an Investors Compensation Fund (ICF) in place. This protects retail investors from a broker’s malpractices and their legal liability for the loss of invested funds.

Fraudulent Activity in the Currency Market

Several currencies in the forex market have recently been caught up in the fraudulent manipulation of prices. These include the US Dollar, British Pound, Euro, Japanese Yen, and Swiss Franc. In an eComms scam, a group of traders at central banks were caught conspiring to manipulate these currencies in a way that could disadvantage their clients and the overall market.

Securities fraud refers to various illegal activities involving the deception or manipulation of financial markets. It can include high-yield investment fraud, Ponzi schemes, pyramid schemes, advanced fee schemes, foreign currency fraud, broker embezzlement, and pump-and-dump schemes.

One of the biggest and most recent scandals involving the manipulation of Forex prices was the Standard Chartered fxcl scam. This large-scale scheme among the bank traders included price manipulation, collusion, and unauthorized disclosure of privileged client information.

Scams in the Forex Market

Forex is an international trading market that averages $6.6 trillion daily. Unfortunately, scammers can exploit this massive volume of money and lure unsuspecting investors into their schemes.

Scammers can also exploit a lack of regulation in the forex market and often target inexperienced traders. They may offer false promises, pushy sales tactics, or give shoddy background information.

Another common scam involves companies or individuals offering trading signals. Retail firms, pooled asset managers, or managed account companies that provide a service–usually for a daily, weekly, or monthly fee–that claims to identify favorable trade opportunities based on professional forecasts.

The Forex market is fast and dynamic, and even the most reputable signal services cannot guarantee 100% accuracy. Therefore, anyone promising guaranteed profits from the Forex market is a scammer, and you should avoid them.

Scams in the Cryptocurrency Market

Cryptocurrencies are largely unregulated, making them a target for scammers. This has led to many investors losing a significant amount of their hard-earned money to fraudsters.

There are several common cryptocurrency scams that you should be aware of. These include pump-and-dump schemes, high-yield investment programs (HYIPs), and nonfungible tokens (NFTs).

High Yield Investment Programs, or HYIPs, promise high returns by recruiting new investors through a payment structure similar to multi-level marketing or pyramid schemes. These schemes promise a percentage of the profits of all of their recruits.

HYIPs also tend to offer a lot of excessive marketing, including paid social media promoters and offline promotion. This can be an excellent way to attract attention, but it can also lead to overly exaggerated claims and hype that can be a red flag.