There are a lot of fraud and scam in Forex market as in other businesses. In this connection most of the law enforcement and regulatory agencies are fully aware of who is perpetrating Forex fraud and where they are located. But keep in mind that only by contacting EVERYONE that you can will get results.
In recent years there has been a sharp rise of Forex fraud and scams. Consumers should be watchful to investment fraud, scams in the persons of companies that sell Forex currencies and commodity brokers claiming that customers can make "a lot of money with little risk". If it sounds too good to be true it probably is.
The United States Commodity Futures Trading Commission (CFTC) is the federal agency that regulates the trading of Forex currency, commodity futures and options contracts in the United States and takes action against firms suspected of illegally or fraudulently selling Forex currency, commodity futures and options.
- Immoral Stop Running/Hunting
You are told by Forex brokers that there is little or no stop running. This is one of their biggest and boldest fabrications. The truth is there is far more stop running in Forex than in futures, and possibly as much stop running as in the stock market.
- Wipe you out by "false" spike
Sometimes, theres very quick spike in candlestick on a brokers chart, but there is nothing happening on the others chart. A stop-loss is triggered simply due to that suspicious spike.
- Ban you if you can win their money
Probably you have heard that if you are winning regularly in Forex, you may be barred from trading. Is this true? Yes it is.
Brokers say they are charging you a 3 pip spread to trade the popular currency pairs. But in reality a broker may be making as much or more than 10 pips on your trades. He does this by skewing prices. Since you are not trading at an exchange, the broker can feed you any price he wants to feed you.
- Skewing price quotation
Forex brokers commonly lean the prices. A Forex broker can only give you the price of a currency as quoted to him by the bank through which he trades. Banks have differing prices for a currency. You never know what the real price is because there is no central exchange through which all prices flow.