Wherever there's a chance to make large sums of money there will be scams designed to rob people of their hard earned cash, and Forex trading is no exception. Experienced investors recognise most scams and avoid them, unlike newcomers to Forex trading who more easily fall victim to scamsters. Governments and consumer watchdogs worldwide warn people to be wary of scams promising massive profits from tiny investments, and offer the following tips to help keep this particular areas of the investment business safe for all:
* Be suspicious of high profit, low risk offers. The reality is that all investments involve risk, some more than others, and the individual must take great care to safeguard his money. Do that by checking all offers relating to Forex trading, and do not part with cash or sign any agreements until you know you're working with a reliable bona fide company. One way to check for scams is to key the name of the company making an offer into Google's search box and look for good as well as adverse comments. A lot of good comments does not mean the company is genuine and reliable, any more than a lot of adverse comments mean you should avoid the company concerned. That's because the company itself may be paying bloggers to post complimentary comments about them, while rival companies are paying other people to post derogatory comments about the company under review. Try to ignore derogatory comments in forums and blogs, often placed by people with an axe to grind or being paid to discredit the company concerned. The exception is comments having back up from government and reliable media sources. If you see a particular company has been sued for malpractice, and lost, give them a wide berth. If nothing bad has been said about the company, dig deeper, and study several search engines for good and bad comments to help influence your investment decisions.
* Avoid sending money over the Internet. Scams are prolific online where fraudsters can create wonderfully professional websites with credit card facilities and quickly scam hundreds or thousands of people before the authorities wise up and close down the site. Where possible visit the Forex trading company in person or at least telephone them. Check out the company's street address, if there is one at the site, and make sure the company has a physical offline presence compared to an accommodation address. If there is no address at the site, or if the telephone is constantly engaged or out of order, that's a good indication of a Forex trading scam.
* Do not ever trade with companies who approach you with unsolicited email or high pressure telephone sales talk. Genuine and reliable Forex trading companies wait for you to approach them first, from advertisements on and off the Internet, or by invitation at their website for you to learn more about the company and how it can benefit you.
Most important of all, remember the best Forex trading companies are in business for the long haul, they want you as a customer for months and years to come. So they don't make promises of short term gains for short term effort. Instead they'll talk about the Forex trading market next year, and the year after that, and they'll tell you Forex trading is about taking calculated risks and never comes risk free.