Category Archives: Scam Warnings

Two Traders, Two Companies, One Big Scam

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Hello traders. Although I can’t confirm this 100% I’d nonetheless like to bring to your attention this scam warning made by the folks at the Forex Peace Army. This just goes to show you that you have to be very careful and do your research before you open an account with ANY forex broker. I recommend you stick with the well-known and highly regulated (in a trusted jurisdiction) brokers.

Quote follows below:

FPA member Yokebeto is part of a trading group from Japan that has been testing out an EA. FPA member Mr. Madruga is from Brazil and was doing his own trading not linked to Yokebeto’s group. We’ve seen him on another forex forum before he joined the FPA.

What the two of them have in common is that both were making a profit on accounts at Velocity4x, which is an IB for StartForex. Also, both were making money trading.

In Yokebeto’s case, he and his group got a note saying that the risk control department determined that all their profits (from a very large number of trades) were due to improper pricing. Their accounts were closed, all profits were confiscated, and their initial balances were returned. This happened to about 20 people in that group.

Mr Madruga’s attempt to withdraw money was met with silence for weeks. Finally, after involving the FPA, he got a single note from Velocity 4x stating that the withdrawal request was being forwarded to Start Forex for processing. Then he heard nothing more.

Yokebeto’s group and Mr. Madruga sent many emails to both Velocity4x and StartForex and CCed the FPA on those. FPA Investigator Gerard also sent a number of emails to both companies. Other than the one note Mr. Madruga got, there was no other reply.

It is possible that Yokebeto’s group might have violated some trading rule. If this is the case, they are owed a thorough and complete explanation, not a quick note telling them they lost 100% of their efforts and profits. Since neither Velocity4x nor StartForex would bother with an explanation, we have no choice but to believe that the traders are correct and the brokerages are improperly taking profits owed to the traders.

In Mr. Madruga’s case, we can think of no explanation other than outright theft, both of profits and his initial balance.

Improperly taking money owed to traders is the FPA’s first definition of Scam. In this case, both Velocity4x and StartForex have met that definition.

Both Velocity4x and StartForex are now blacklisted by the Forex Peace Army. If you have an account with them, we urge you to withdraw your funds as quickly as possible. We also urge all traders to not place any money with these companies.

Official scam finding against Velocity4x and StartForex

Yokebeto’s original complaint against Velocity4x

Original source: http://www.forexpeacearmy.com/forex-forum/scam-alerts-folder/4550-two-traders-two-companies-one-big-scam.html

Good luck and stay scam free.
Alan
http://alansforexblog.com

ForexGen – 3 Confirmed Scam Cases Against This Broker

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Check out this interesting post I’ve found on the ForexPeaceArmy forum:

–begin quote–

Greetings to our fellow soldiers,

We, the members of the FPA Scam Investigations Committee, have confirmed a 3rd scam case against ForexGen. Once again, they have stolen money from a trader. This time, they claim there were hostile activities that justified them extracting 100% of all of his profits from his account, but repeatedly refused to provide any evidence of these activities to the trader. They also claimed the account was inactive, but ignored proof provided by the trader that showed the account was active.

Lt. Ken, who is is one of our investigators, tried to contact ForexGen to see if there was a way to resolve this issue. The result was that his name and email signature were posted in another forum by a person attempting to discredit the FPA. Later, an anti-FPA propaganda blog faked a date on an entry claiming to have had Lt. Ken’s name associated with the FPA in February of 2007. The Scam Investigations Committee did not exist then. The FPA was called ForexBastards at that time and consisted solely of reviews. Back then, there was no forum and no investigations other than those that Felix and Rob personally did. Lt. Ken only began working for the FPA in late February of 2008. It is obvious to us that ForexGen is actively coordinating an effort to discredit the FPA in order to try to draw attention away from their repeated theft of funds from traders and support of other unethical activities online.

The first case against ForexGen was when they stole over $160,000 from Rashid as well as various sums from other traders. The second case was when our member Pharaoh proved that one or more ForexGen IBs were posting false conversations in many forex forums to advertise ForexGen as well as spamming ads in many non-financial forums. ForexGen failed to lift a finger to stop any of this, and even provided the text of a complaint made by a forum owner to their spammers. The third case is the flagrant theft of all profits from our member Adam.

We have blacklisted ForexGen for both the thefts from traders as well as their support of other unethical activities online. If you have any money with them, stop trading the account and try to withdraw it immediately. We also strongly encourage anyone who has lost any amount of money to these scammers to contact Okokrim. This is The Norwegian National Authority for Investigation and Prosecution of Economic and Environmental Crime. Their website is…

www.okokrim.com

There is an “Information in English” button on top of the page.

Okokrim can also be reached by email at okokrim@okokrim.no

We have heard that the Norwegian police are building a case to finally put an end to these scammers. Any solid evidence of more thefts by ForexGen that you can provide to them will be helpful.

Our conclusions for each case are here…

ForexGen (Case 1)

ForexGen (Case 2)

ForexGen (Case 3)

Join your fellow soldiers and help protect the world of forex from scammers like these. Warn your fellow traders not to do business with ForexGen. Do your part and help us to end ForexGen’s scams

We hope you get many pips and don’t lose a single one to scammers,
FPA Scam Investigations Committee

–end quote–

Proof that forex brokers cheat you

You’ve probably heard of Forex brokers ripping off their clients by using various dirty tricks. Some of the most common ones are: stop hunting, requoting, widening the spread to some ridiculous number, software disconnects, lagging/fraudulent price quotes, unfilled orders, and account banning. Yes, they will politely (sometimes not so politely) tell you to bugger off if you’re consistently profitable.

I bet you’d like to know what tools brokers use to accomplish their nefarious deeds. Well, I’ve got just the thing for you! Check out the screenshots below:

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Yep, your eyes are not deceiving you. They actually have very specialized and advanced software that they use on their trading servers to make sure that YOU end up losing. In most cases the majority of these so called brokers don’t even deserve that title. Technically speaking a broker is only an agent who executes orders on behalf of clients, whereas a dealer acts as a principal and trades for his or her own account.

Someone asked on MetaQuotes forum “What is the Virtual Dealer plugin used for? Many pepople want to know.” and guess what happened:

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Here is more:

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Lovely, isn’t it? I very much doubt that only MetaTrader4 based brokers have this type of software installed on their trade server. I often hear brokers touting that they have “no dealing desk” and whatnot, but to me this is just exploiting the vagueness of language. When they say that they have no dealing desk they really mean it, BUT what they really mean is that they have no HUMAN operated dealing desk, and instead they use software dealing desk applications such as the one you see in the screenshots here.

Experienced trades already know the games dealing desk forex brokers play so this post is mainly geared towards beginning traders. Having said that my advice is this:.

1) Stick to only so called “reputable” brokers. Do your research before you open an account with any broker. It may also be helpful to ask them if they use virtual dealing desk software. Ask them to send you a written statement saying that they do not. If they refuse or do not answer then simply move on and DO NOT open an account with them.

2) DO NOT open up a large account with dealing desk brokers. I’ve come to learn that the majority of brokers have software routines that specifically flag large accounts. They will target you and incrementally erode your account balance using their dirty tricks.

3 ) If you can avoid this stay away from trading before/during/or immediately after important news releases.

4) Take money out of your brokerage account on a regular basis!

5) Learn learn and learn some more. Practice in a demo account until you are consistently profitable. When you are then I suggest you look to open an account with an ECN broker.

That about does it for this post. If you wish to discuss this topic you can either visit the Forex Nirvana forum (my own forum) or the forex factory forum thread.

Forex Nirvana Forum:

http://www.forexnirvana.com

Thread on the Forex Factory Forum:

http://www.forexfactory.com/showthread.php?p=1855072#post1855072

Happy trading everyone, and I hope you don’t end up being victimized. If you do please see me with your proof/evidence and I will gladly publish it on my blogs.

Crown Forex Price Manipulation

I’m sure you guys know this already but there are so many brokers who engage in stop hunting. It appears Crown Forex has been caught “red handed” doing this very thing. This is a sign that you want to avoid this broker at all costs as you will get ripped-off.

Check out these pictures. As they say a picture is worth a thousand words. The conclusion is:

Crowne Forex = bucketshop = avoid

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If you feel the burning desire to discuss this issue please refer to this forum topic:

http://www.moneyguruforum.com/scam-brokers/2925-crown-forex-price-manipulation-new-post.html

ForexGen – Scam forex broker or legit??

A while back I made the following post:

http://alansforexblog.com/2007/10/23/scam-warning-forexgencom-stay-away-from-this-forex-broker/

In it I brought to you a general warning issued by a fairly reputable member of the forex trading community – Rob Grespi – urging you to stay away from a forex brokerage firm that goes by the name of ForexGen. I also started a thread on my “money forum” over here:

http://alansmoneyblog.com/forum/index.php?topic=1950.0

It seems the forum thread sparked some heated debate. So, I would like to invite all those of you who have some experience with this broker to jump in the forum and give us your opinion. I’d really like to flush out the truth here.  First off I must admit that I am a bit biased. So far my opinion is leaning in the direction of ForexGen being just another fly-by-night bucketshop. If you read my previous post dealing with ForexGen you’d know why. The issue raised in that post by Rob Grespi still has NOT been satisfactorily addressed by ForexGen staff. So once again, if you have any information or experience you’d like to share please visit the forum link and let us know. Your post might prevent a lot of people from being scammed by ForexGen.

Once again the forum link is:

http://alansmoneyblog.com/forum/index.php?topic=1950.0

I Hope to see some people step up to the plate and share with me and the rest of the forum members their experience with ForexGen (if any)