What is forex?

The Forex market (FX) is the world’s largest trading market, dwarfing the Stock Exchange in size with nearly US$5 trillion traded daily. The market is open 24 hours a day, when trading closes in New York it starts again in Tokyo and Hong Kong. Currencies are always traded in pairs, for example the US$ with the UK£ or the US$ with the EURO. With constant price fluctuations this tumultuous market can make Institutions, companies, and some individuals a great deal of money.

Most of Forex trading happens in the spot FX market, which is different from the futures market, in that currencies are physically exchanged in real time when a transaction is made. Whereas in the futures market the date the trading price is determined and the date the currency is exchanged are different. When a holiday-maker goes to their bank to exchange currencies they are participating in the spot FX market.

GT FX's banking and financial lawyers point to the following features of the Forex market that make it susceptible to Forex trading scams and Forex frauds: There is no regulated centralised exchange.

Currencies are traded via computer networks between one trader and the next, often referred to as over-the-counter (OTC). The Forex market is a high leverage market. This is basically a loan by the broker to the trader allowing the trader to trade at a margin. A typical margin ratio will be around 50:1, 100:1 or 200:1 depending on the amount of currency being traded.

At 100:1 the trader only needs to put up £1000 to cover a £100,000 trade. The reason brokers provide such high leverage is because currency fluctuations in the Forex market are not usually more than 1% during anytrading. However even with small fluctuations, high leverage attracts inexperienced traders who may think the Forex market is a get rich quick market.

Is Forex a scam?

The Forex market is a legitimate trading market where the world’s currencies are traded. It is not a scam in itself. Without the Forex market it would be difficult to trade the currencies needed to buy imports, sell exports, to go on holidays or do cross border business.

However with high leverage positions which, in theory, have the potential to make traders a lot of money and because there is no centralised/regulated exchange, scammers take advantage of the situation and the inexperienced traders desire to enter the market.

The Forexmarket is a ‘zero sum’ market, which means that for the trader to make a profit,another trader will need to make a loss, the Forex market does not itself add value to the market. Because a lot of the currency movements are directed by large well financed corporate institutions and banks, who are better informed about the market as a whole,the under capitalised trader is always likely to lose.

Institutions and large banks trade in Forex on a daily basis; to make a significant profit in this market takes a considerable learning curve.

Gt Trust Universe has found that scammers take advantage of the complexities around the Forex market, maliciously withholding important information about market realities from their unsuspecting novice victims, claiming their scheme, information or software robot will bring success

The following Forex scams list documents the scam type that have been involved in Forex frauds at present and in the past.

The signal seller scam is a scam which works bya person or a company selling information on which trades to make and claiming that this information is based on professional forecasts which are guaranteed to make the inexperienced trader money.

They usually charge either a daily/weekly or monthly fee for this service but do not offer any information that helps the trader make money. They will usually have a slew of testimonials from allegedly legitimate sources in order to gain the trader’s confidence yet in reality do nothing to forecast profitable trades.

High yield Investment programmes (HYIP) are frequently just a form of Ponzi scheme in which a high level of return is promised for a small initial investment into what is infact a Forex fund. However in reality the initial investors are being paid back from the money generated by the current investors and a constant flow of new investors is required to keep the funds flowing, once there are no more investors in the scheme the owners usually close it down and take all money remaining.

These types of scams have decreased over the years yet they are still around. Therefore it is important to choose a Forex broker who is registered with a regulatory agency. These types of scams would normally involve having spreads of around 7-8 pips instead of between 2-3 pips which is the norm.

How can GT UNIVERSE help me if I have been scammed?

GTRUST UNIVERSE law firm known as GT-recovery is a leading mid-size international law firms with a team of experienced lawyers specialising in Forex fraud. GT-recovery assists traders in civil and criminal actions against unregulated Forex companies, online internet fraudsters and pyramid schemes created on a Ponzi-style structure. GT-recovery also specialise in legal actions against Binary Options trading companies.

GT-recovery forex lawyers have recently been involved in:

Retrieving more than £12.5 million from the Traders International Return Network (“TIRN”)

TIRN promised high yield returns of between 9% –22% by using “professional money managers” investing in the forex market. Yet in reality none of the trader’s money was invested in the market and TIRN’s operators misappropriated around US$15 million for their own personal benefit.

GT-recovery advise investors in Finanzas Forex GT-recovery forex lawyers have been advising investors from Italy, Spain, Portugal, Malta, Scandinavia, Latin America (Brazil, Argentina, Columbia, Equador and Mexico) who have been victims of Finanzas Forex and the related Evolution Marketing Group (“EMG”). Finanzas Forex is now in liquidation and GT-recovery are continuing to help traders recover funds from this scam.

GT-recovery forex lawyers are also representing traders and investors in collective legal actions in relation to Telex free, AGF Markets, LBinary, NRGbinary and others.

GT-recovery makes the process of starting your claim straight forward All that a Forex victim has to do to start a claim is to complete an online claim form and send it back to GT-recovery through GUARANTEE TRUST UNIVERSE/REALTY. You will then be contacted by a forex lawyer who will advise you on how to proceed.

How forex scam victims can get their money back -forex lawyers

Gt Trust Universe continues to fight vigorously for the protection of customers and to ensure the wrong doers are held accountable. If you are a victim of online fraud / scamor have lost funds witha Forex broker through no fault of your own, please contact our Client Relations Team to arrange a discussion witha lawyer in the Forex Trading Litigation team. Our international lawyers are able to provide assistance in English, French, Italian, Spanish, German, Arabic and Chinese.

Forex robot scammers lure novices with the promise of big gains from little effort or knowledge. They may use of fake or misleading figures to convince customers to buy their product. Their promises are flawed as no robot can adapt and thrive in all environments and markets. Software is generally used by professionals only to analyse past performance and to identify trends. All software should be formally and independently tested.

These can be a type of Forex scam and there are many examples of managed accounts. These scams often involve a trader taking your money and instead of investing it they use it to buy all sorts of luxury items for themselves. When the victim eventually asks for their money back there is not enough money left to repay.

This is a very common form of affinity fraud. They promise high returns from a small initial investment up front. The early investors usually do gain some sort of return on their money and motivated by this success they then recruit their friends and family into the scheme. However the truth is that the ‘investment opportunity’ does not actually exist and their initial return is being funded by money paid in by other members of the scheme. When the investor numbers start to drop the scammers close the scheme and take the money.

If you have been scammed, report the scam to us, we can help you recover your money through legal proceeds. It is a good idea to tell your story to the Forex community so that other individuals do not fall foul of the same scam.

TO START YOUR CLAIM, CONTACT US