Learning About Global Forex Trading Schemes Online

Learning About Global Forex Trading Schemes Online
Forex is a foreign exchange


market that trades on a global
basis. It is a big money
business that is attracting
investors all over the globe,
including newcomers. Newcomers
are advised to look out for
global Forex trading scam offers
on the Internet when entering
into the market. Many trading
schemes are used to defraud new
traders, and even established
traders.

Some scams are used to convince
traders to expect higher gains
or profit by trading in Forex
and making substantial deposits
into an online account. The
global Forex trading scams
reported in 2008 by United
States Commodity Futures Trading
Commission was dubbed the "fraud
du jour who also sent out alerts
about scammers". FX (Forex) has
long been beleaguered or plagued
by the scammers who prey on
vulnerable people according to
New York Times, who also
reported in 2008 that the
average victim lost $15k.
Swindlers put traders at a
serious risk.

Some of the investors who were
scammed were promised $10,000 in
profit gain in just a few short
weeks, or months. Swindlers
advised the investors to deposit
$5k to gain such profit. The
swindlers who convinced the
investors to make the large
deposit would never place the
money into a foreign exchange
account; instead, they would
deposit the funds into their own
hands or into their bank
accounts. Due to these illegal
actions, CFTC posted national
bulletins, informing the Forex
communities that new changes
were coming.

CFTC recorded in 2008, that the
organization would be setting up
a special task force to combat
growing scams in Forex. By 2010,
new rules were proposed by CFTC,
which the organization put a
limit on leverage. The new
limits were set to 10 to one,
depending on the number of
fraudulent practices, or
improper practices, which is
listed below:

Some of the behaviors CFTC asked
people to look out for, and used
to structure the limitations
included unsophisticated
marketing targets,
unresponsiveness to consumer
complaints, lack of lucidity
pricing, transaction executions,
solicitation of fraud, low net
worth, vulnerable individuals,
elderly, and so forth.

Professionals call the Forex
market a "zero-sum game". What
this means is simple - that it
is whatever a trader gains,
another trader loses. Yet when
brokers earn their commissions,
and are paid for transaction
costs, these sums are subtracted
from all the traders' results,
which returns a "negative-sum",
thus creating a game.

A fraudulent schema that comes
to mind is the Ponzi scheme.
Some people may have not heard
of the scheme, but it occurred
in the early 20s. The Ponzi
scheme often involved practices
such as offering investors more
money in exchange for larger
investments. Before long,
millions of dollars was swindled
from investors by the con
artist. This same global Forex
trading scam occurs today.




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