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I was contacted by a 'broker' in January, they said they're based in Switzerland (I'm based in the UK), and they asked to invest some money (as minimum as $1000).

They told me that my platform would be connected to the main one, so I will automatically follow the manual trades opened by professional trader with 8 years experience in trading.

They've sounded very professional and authentic, so I've invested few thousand Euros to try, along with their 100% equity credit on top of it. While progress was promising (they've doubled the balance), in the next week, they've told me that they purchased some information on some trading exhibition, so they're 99% sure about the next deal, and since they've earned my trust, they've asked for another 5000 to lower the risk. They sounded convincing, so it happened along with their 100% equity credit.

After 4 weeks, while keep updating me every few days about the great progress (without pressure), they've tripled my balance and earning my trust. However, now, they asking for another 20000 on top of it on their new big deal which I refused. This gave me the big red flag.

After searching, I've found one complaint on them online here, but it's not clear whether he just lost the money, also it doesn't confirm whether it's a scam, or not, and how it works.

Their domain website is around 1 year old. It's not clear who owns it. Their certificate has been authorized by Let's Encrypt (related post).

My agreement reads that I can't withdraw within first 3 months, but they could be gone before then.

How can I tell whether they're scammers or not for sure? If they are, what would be the best approach to get my money back?

kenorb
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    You are in the UK. Aren’t there well known brokers that are local? Why would you even consider a broker in a different country? – JTP - Apologise to Monica Mar 08 '18 at 15:20
  • @JoeTaxpayer Other don't offer manual trades for you, you need to trade for yourself. They open trades for you, so you don't have to do anything. – kenorb Mar 08 '18 at 15:21
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    Contact FINMA which regulates the Swiss financial markets, possibly the equivalent in the UK as well. – Bob Baerker Mar 08 '18 at 15:27
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    Contact them and ask to withdraw your funds and close your account. If they resist, it's probably a scam, and the chances of getting your money back are slim. – D Stanley Mar 08 '18 at 15:30
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    @PeteB. There are legit companies on the market which can trade for you, but they require bigger portfolios, like $100k. – kenorb Mar 08 '18 at 15:31
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    @kenorb is the goal to turn that 100K into 10k or less? Seems weird, but I guess people have such goals. I've meet people that hate money that much. – Pete B. Mar 08 '18 at 15:32
  • @PeteB. They've tripled my money in 4 weeks so far, I can verify that on the MT4 platform by connecting to their broker server. – kenorb Mar 08 '18 at 15:33
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    did you check the FCA register before "investing"? https://register.fca.org.uk/ShPo_HomePage - note: I did a little due diligence on your behalf but not enough to create an answer and I'm still not sure how they are related to Sun Capital LTD – MD-Tech Mar 08 '18 at 15:35
  • @MD-Tech Some binary brokers doesn't register with FCA, but they still trade fine, and they're not scammers. – kenorb Mar 08 '18 at 15:36
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    @kenorb I'd strongly disagree that binary options aren't a scam – MD-Tech Mar 08 '18 at 15:37
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    @kenorb the real test will be if you can get that "tripled" amount out. Otherwise it's just words on a screen. – D Stanley Mar 08 '18 at 15:50
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    Never ever do business with a broker that contacts you first. – Chris W. Rea Mar 08 '18 at 16:30
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    Having a broker choose binary options on your behalf sounds to me like asking a casino employee to choose whether you bet on red or black. I am not convinced that this 'service' would be a good reason to choose a foreign advisor instead of a local one that you can confirm is real. All signs here point to this being a scam. If you tripled your money based on their advice in a few weeks, why would they even need your money to trade??? Why wouldn't they make the money themselves if they had a perfect 'system' [which doesn't exist]?? – Grade 'Eh' Bacon Mar 08 '18 at 17:36
  • @Grade'Eh'Bacon They don't trade binary options, they trade Forex (such as EURUSD), DAX and Bitcoins. – kenorb Mar 08 '18 at 17:59
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    @kenorb Bitcoin? Even worse. Just went from 100% chance of scam to 200%. – Grade 'Eh' Bacon Mar 08 '18 at 18:04
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    "They've tripled my money in 4 weeks so far", no, they have not. Everything single thing they have told you is a pack of lies designed to extract more of your money from you. It's not your money anymore; you gave it to con men. – Eric Lippert Mar 08 '18 at 19:25
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    You say "when they gained some trust" -- from whom did they gain trust? From you? How did they do so? – Eric Lippert Mar 08 '18 at 19:26
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    @EricLippert I can download their MT4 client (MetaQuotes installer), login to their servers using MT4 and I can verify my balance/equity on the real account, so it's not based on the lies. They gained the trust in terms, that they've tripped the money balance within 4 weeks, so they know what they're doing and they're trying to prove they're not scammers, but real deal. But I can't any record of their LTD company anywhere. – kenorb Mar 08 '18 at 19:27
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    @kenorb Based on your profile you're an IT engineer – surely you realize that if you download software from them and their software receives data from their own servers, they can make it show you whatever they want? – Moyli Mar 08 '18 at 19:31
  • @Moyli It's not entirely their software, it's shipped by MetaQuotes. Each broker needs to pay expensive license to have their own version of the MT4 wizard (AFAIK). Their setup wizards are enough secured from the hackers, so it's almost not possible to hack it. Most of the files are enough encrypted. And having own MT4 servers is really a big deal. I'm the author of few tools aiming at reading these files, but cracking the whole wizard would be too sophisticated. Easier is just to go and rob the bank, than fake it. – kenorb Mar 08 '18 at 19:37
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    And MetaQuotes also guarantees that the data coming from the scammer's server is correct and actually represents the money they've made for you? I know it's hard to accept that the money is lost but come on... – Moyli Mar 08 '18 at 19:57
  • @Moyli In this cause they would have to reverse-engineer and hack the entire protocol and communication between the official client and their fake server where their server and its API is closed code. I'm not sure if that's the case. – kenorb Mar 08 '18 at 20:01
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    "*Hi, can I have my money back". "Sure, That's in your bank account now*" = Not a scam. – Valorum Mar 08 '18 at 20:22
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    "*Hi, can I have my money back". "Er, no.*" = Scam. – Valorum Mar 08 '18 at 20:22
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    If they can triple an investment in 4 weeks, then what are they doing contacting random foreigners? Why not just toss in 3 bucks and have half a million after a year of investing? And if they already asked for 5000, what do they need 20000 for? They can just wait a month and a half and have more than enough. – Ethan Mar 08 '18 at 21:01
  • @Ethan Extra 5k they wanted for DAX market as they cost ~12k (btw. for each deposit they give 100% credit), now extra 20k for NFP in USA market to lower the risk. They need enough free margin, as they're opening the whole lots. According to them, they've over 100 clients, so 15-20% profit commission + 6% withdrawal fee from all of them (while doubling their money), it's a big profit for them at the end. – kenorb Mar 08 '18 at 21:17
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    @kenorb If they can triple your money after commission in a month AFTER commissions, then they don't need your money. At that rate, if they put in just 5k of their own cash, they'd be billionaires within a year. Do not give them another dollar. This is a scam. Everything about it screams scam. Mark their emails as spam, report them to the authorities, and try to get your money back. If you really want to verify, ask for just your initial investment back. If it's really tripled, you're leaving plenty invested still, and you'll be a billionaire soon. – Ethan Mar 08 '18 at 21:28
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    Even supposing that the balance in your account is legitimate, which it isn't, where did it come from? The easiest way to triple your money in four weeks is by depositing money from suckers that joined this scam later than you did: that is, a Ponzi scheme. If by some miracle you manage to withdraw that money, expect to have regulators confiscate it from you to pay back the people it was stolen from. – Eric Lippert Mar 08 '18 at 22:48
  • @EricLippert The balance and transactions are legit as per transaction history, I don't question them (also it's a live account, not demo). The balance was 8.5k, tripped to 31k in 4 weeks. If I add extra 20k, I was told I would see 120-150k in the next month. – kenorb Mar 08 '18 at 22:55
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    Today would be a good day to start questioning them. You seem very eager to be taken by this scam; if you're so convinced that they're legitimate then why are you asking us if it's a scam and then ignoring everyone who says "yeah, obviously"? – Eric Lippert Mar 08 '18 at 22:59
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    That transaction history makes absolutely no sense. Someone is mucking with those numbers hard. You are "making profit" from both buying and selling. And market swings of less than $200/share is generating $10k/share in profit? – TemporalWolf Mar 08 '18 at 23:01
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    People who can magically triple any amount of money in a month wouldn't waste their time doing so for a small fee, they'd be taking out and paying off bigger and bigger loans/investments until they were trillionaires. They'd also be unicorn-riding leprechauns or something, because humans don't have magical powers. – Matthew Read Mar 08 '18 at 23:03
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    the last germany30.m buy/sell was for a net $130.59 profit and that transaction history shows it generated $18874.76 in profit. these books are doctored – TemporalWolf Mar 08 '18 at 23:09
  • I would rather imagine that the scam is not about transactions, but about taking money from as many clients possible, then the company go bankrupt/dissolved in a year. So I'm trying to understand where is the scam. – kenorb Mar 08 '18 at 23:11
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    Who cares what the mechanism of the scam is? You're not law enforcement, you don't have to prove in court that it was a scam or how it worked. Your goal here should be to think hard about how it was that you got taken, and make sure it doesn't happen again. – Eric Lippert Mar 08 '18 at 23:12
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    It also shows they bought 3 shares of eurusd @ $1.23/share and you paid $1548.86 for them. Those books are totally nonsense. – TemporalWolf Mar 08 '18 at 23:15
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    "Their certificate has been authorized by Let's Encrypt" I have 8 SSL certificates from Let's Encrypt, and I'm just a random nobody. You can get one yourself, for free, right now, in 2 minutes, and as an IT engineer you should already know that this means absolutely nothing about the recipient's trustworthiness in some arbitrary financial dealings. – Lightness Races in Orbit Mar 08 '18 at 23:51
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    Anyway, yeah, I stopped reading after "I was contacted by this broker in January, they said they're based in Switzerland (I'm based in the UK), and asked to invest. First they've asked for few thousand Euros" No further details necessary. Sorry to be blunt but I can't fathom why you went along with this. – Lightness Races in Orbit Mar 08 '18 at 23:52
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    @LightnessRacesinOrbit: Indeed. We can go further; the original poster notes in a comment that "most of the files are enough encrypted". I don't know what this means, but I do know that encryption and certificates are not magic pixie dust that you sprinkle on software and it makes the authors of that software trustworthy and the application secure from attack. Encryption works extremely well to solve some very narrowly defined problems. – Eric Lippert Mar 09 '18 at 00:16
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    @EricLippert: Mmm *nods*. I guess my main concern is in finding a way to more broadly educate the OP regarding precisely that kind of thinking. – Lightness Races in Orbit Mar 09 '18 at 00:20
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    About the certificates from Let's Encrypt: from infoworld.com, emphasis mine: "Once issued, Let's Encrypt does not monitor the certificates or take any action afterward. Even if Google later flags the domain as malicious, Let's Encrypt will not revoke certificates.". Also, remember: If a site uses HTTPS it means that you are talking to that site, and no one else can see or alter the data you exchange with them; it doesn't mean that the site is honest!. – Fabio says Reinstate Monica Mar 09 '18 at 01:40
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    Even if you assume they're legit there's still absolutely no reason to put more money into a system that's already generating money! At this rate it will take about two weeks for the balance to grow the extra 20k. You're on a fast track to become a millionaire, why risk the 20k just so that you can become a millionaire two weeks earlier? (Disclaimer: you're not on a fast track to become a millionaire.) – Moyli Mar 09 '18 at 07:11
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    OP stated "There is one complaint on them online here, but it's not clear whether they lost money, or they're scammers." I just read the same complaint, and it's VERY clear that they are scammers. – barbecue Mar 09 '18 at 16:10
  • Comments are not for extended discussion; this conversation has been moved to chat. – GS - Apologise to Monica Mar 11 '18 at 16:21
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    "8 years of trading"? So he's only worked in an up market? Anyone can make money when the market is going up, wait and see what happens to his investments when the market does down. – Johnny Mar 13 '18 at 06:13
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    Is there any well known theory that explains why @kenorb is falling for this? Is it because s/he doesn't understand the information being given to them? Is it just because s/he doesn't want to believe s/he made a wrong decision previously? Is it because they've never seen a scam before and therefore trust all information given to them by default? – user253751 Mar 13 '18 at 20:54
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    I think kenorb believes that it's impossible to build a MT4 server or easier to rob a bank as he puts it due to the API being closed source and client SDK being obfuscated in the platform. That's kind of sad underestimation of how strong programmers can be and how trivial it can be to reverse engineer a protocol. In this instance the scammer provides a config file that points to a Hetzner/OVH server or similar. This server proxies the request back to a real MT4 server for market data however when the request is transaction history he/she sees a fake statement feed by scam api server. – Mâtt Frëëman Mar 14 '18 at 03:39
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    "I invested some money" and "Is this a scam?" is exactly the wrong order of things. You really should have ascertained the scamminess before handing over your moola. –  Mar 14 '18 at 09:18
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    No serious finance player will never ever use Let's Encrypt for its certificate authority. Never Ever. This looks like a red flag to me too. – SCO Mar 14 '18 at 10:06
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    @user20574 In my opinion, this is a clear case of wishful thinking and while this particular instance is certainly acute, the wishful thinking mechanism is built into Homo Sapiens' brain and everybody, 100% of people (only not counting those with mental diseases) are driven by that mechanism, although to different extents, in different situations, in different areas etc. All of us. Once we accept this, we slowly start realizing the instances in which we have done exactly the same ("I'd like things to be X so I'll think they are X"). – SantiBailors Mar 14 '18 at 12:29
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    @user20574 a mix of wishful thinking, and likely "I already sunk some money into this, I want to believe I didn't lose that money". Once you've invested a certain amount in something, "backing up" can be hard, as it amounts to forgetting that money and accepting you can't recoup it – Patrice Mar 14 '18 at 14:46

8 Answers8

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  1. They call you, instead of the other way around.

  2. They promise more than 10% a year return*.

  3. They ask you for rapidly increasing sums of money.

  4. Multiple unrelated domains use their exact website.

  5. They ask for more money in the "trial" period during which you can't withdraw money.

  6. You find ZERO positive references for the company.

  7. They provided an erroneous transaction history.

If you ever have an investment opportunity and encounter A SINGLE ONE of the above points, don't invest. If you encounter 2 of the above points, it's a guaranteed scam, although it may be a borderline legal one. You encountered 7. I'm sorry for your loss of money, take it as a learning opportunity and move on.

*In fact, they promise ~200% a month, which is ~53,144,000% a year. The good news is that means they only go for the most gullible targets (sorry for being so blunt), so you have a tiny chance of getting some of your original investment back if you involve a lawyer right now.

** The 10% rule assumes a relatively stable base currency like USD, GBP, EUR. If you're dealing in a currency with high inflation, the annual return in said currency often should and will be higher than 10%.

Robbie JW
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Peter
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    What's wrong with 53 million percent interest? :) Some commas would make that ever so slightly more clearly bat-poop crazy. – stannius Mar 10 '18 at 00:03
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    @stannius I tried, but using 1,000-separators on annual interest just feels wrong. – Peter Mar 10 '18 at 08:30
  • "If you're dealing in a currency with high inflation" - maybe amend rule to "10% a year return, adjusted for inflation"? – reducing activity Mar 10 '18 at 11:31
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    @MateuszKonieczny I can't find a way that's short, easy for novices to understand, and doesn't sound like the investment opportunity needs to predict inflation with high accuracy. – Peter Mar 10 '18 at 11:54
  • I vow for making "you can't withdraw money [for period]" a separate item. Otherwise great answer. Upvoted. – Marc.2377 Mar 15 '18 at 08:17
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    Add to the list: 8. They tell you they purchsed insider information. 9. They're 99% sure about the next deal. – Daniel Mar 15 '18 at 14:15
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    oh and 10. You can´t find a official record of the company in the respective company register of the country they are operating from. – Daniel Mar 15 '18 at 14:36
100

This is part of highly sophisticated network of scammers. This scam is spread across hundred of websites (some list can be found here and here), most likely using "fake" or stolen details and they're very good at covering their tracks.

Scam broker checklist

  • They called you out-of-blue offering the great earnings. Check.
  • They pressure you to keep investing more. Check.
  • They've contacted you using one-way VoIP services, so you can't call them back. Check.
  • None of their phones numbers on their website are working. Check.

  • Their addresses on the websites are non-existing. Check.

    Note: You can hire a local private detective to verify that for you, but it costs.

  • You can't find their legal name and list of the directors. Check.

  • You can't find their company status and their license anywhere. Check.
  • They tell you to provide the legal info, but the conversation is always going to nowhere. Check.
  • They ask you do you do and how much you earn. Check.

  • They're using non-PCI complaint form to process your payments. Check.

    The PCI DSS applies to ANY organization, regardless of size or number of transactions, that accepts, transmits or stores any cardholder data.

How they start

  1. Scammer purchase the fully branded FX Platform startup package for few thousands dollars (like this). This comes with several necessary Forex licenses.

  2. They've got their business and financial licensing registered on some tax-free island such as Vanuatu or St. Vincent & the Grenadines. The license is a period of one year, so they need to be quick to start their scamming.

    Warning: After you sent them your legal documents, you could be one of the directors of such scam companies in Vanuatu or other tax-free island, hopefully you will never find out.

  3. They find some cheap IT company (e.g. in India) to multiple the same branding into many, including apps for Android/iOS.

  4. They may setup some temporary company in India (which can disappear later on) where all of their websites points to the same WebTerminal. They're using servers in India to send the automatic e-mails.

    Note: If you decide to sue the Indian company, court cases may take few years just to start.

How they work

  • They're using one-way VoIP services, so they can call you from any country you want to believe they're calling. This also helps them to isolate from the outside world, so nobody actually can contact them and verify nothing about them. They work like a ghost company.
  • When you ask them for the licenses, they tell you they have everything, but at the end, they never send you anything (the less you know, the better). At the end, you can never find out their real legal name.
  • When you report them to companies with who they've agreement (i-Pay, MQL5), they show to them their legal documents and existing licenses, no question asked. And they probably portrait you, as another client who lost his money in trading, looking for revenge. So the scammers can't disappear so easily.
  • When you apply for a chargeback, they may even fight back with their existing legal documents which you never seen, or know they have.

  • If you try to fight them, they're good at fighting back. I've reported them at MQL5, both of my accounts got banned for no reason.

    "Thank you for contacting us. Your accounts will not be restored. Best regards, MQL5.com Support Team"

  • They use one license spread across many different domains and fake companies.

  • They could use the valid, licensed platform, but with illegal plugins for the platform to fake the transactions. At the end, these are just numbers on the screen. However, you can't prove that.
  • At the beginning, they may trade on the real server (which they own), but as soon as they start their scam plan, they can switch to the demo server (at the end, it's just the IP address to where you platform client is connecting to). Then they operate on a demo server which they make you believe it's a real one. You can't prove that part either, without hiring some digital forensic team (which may costs).
  • The main goal of the scam is to take as much money as they can, then burn your account at the end (on their so-called live server), and blame you to not have enough margin, then lock you down.

How the scam works

  1. They call you out-of-blue (having your details on some scam "sucker's list" from the previous scammer) from some one-way VoIP numbers (any country code they like you to believe they're in).
  2. At first, you talk to the sale person (first line of contact). His goal is to generate as many leads as possible. After you proceed, you may never talk to him anymore. He doesn't care whether it's a scam, or not, he has a job.
  3. He redirects you to another scammer (the second line of contact), who explains to you about this no-brainer deal (your experience doesn't matter). He's expert in lying, explaining all your concerns about the company, financial licensing (which you never get), telling how bad other brokers are, how they hate other scammers and so on, basically everything that you expect to hear.
  4. You did your basic research by checking more information about them, have a glance at their list of non-working numbers and random-generated addresses, long terms and conditions which you don't have time to read (which coincidentally got missing links to the withdrawal form), but you still progress.
  5. You went through the registration process, so you can log in and decide to deposit the money through their non-PCI compliant form, since you feel safe seeing the nice green padlock icon (which just verifies that you're connected to the scam-site) and a lot of recognizable images of Visa and other banks.

  6. After you submitted your debit/credit card details, they got posted to another SSL-secured scam website which keeps them safe for future use. Most likely the payment gateway website is owned by another customer of theirs.

    scam Visa form

    Note: At this point, you're the one who initialized transaction. You knowingly sent them your money, so it's no longer a fraudulent transaction.

  7. Now, your money is safely deposited in bank located in some tax-free island. This basically was a one-way untraceable payment.

  8. You can't prove that part, but your money may never go to any trading account (not a single cent), it's too risky business even for them. Most likely, what you see from now, are just digits generated on the screen by their so-called live server.

  9. Since they've your payment card details, they're now missing your full address and pictures of your card (front and back). Make sure the pictures aren't blurred and you send them also the back of your card (you can cover the last 3 digits, so you feel safer, but having your address, it doesn't matter).

    Your payment details and address are enough to use for scammer expansion costs (new domains, hotels, taxis, - everything costs). If they buy some new domains or register new companies using your documents, don't worry, you'll be the their first line of contact.

  10. Now they're using MetaTrader4 platform to convince you that they're trading with your real money. Of course, they'll guide you step-by-step how to use it, and all that you need to know, in the order you to believe the number you see on the screen is the money you've invested. They can give you extra 100% credit on top of it, so you're motivated to top-up more.

    Note: Your money may never leave their bank account, or they may cash it.

  11. So you've downloaded the MetaTrader 4 platform from the official MQL5 CDN server, like:

    https://download.mql5.com/cdn/web/ID/mt4/fakebroker4setup.exe

  12. You run the platform and you login to FakeBroker-Live server. It's called Live, because it's the name of the file, so no question asked since it has been approved by MQL5 Ltd. If they tell you it's a live server, it must be, especially when you see some Ltd name next to it.

    Compromised files includes: 2dots-Live.srv, SunCapital-Live.srv, 4xBrands-Live.srv, Investment4Futures-Live.srv, UP4X-Live.srv, SolidPlus-Live.srv, StrategicFuture-Live.srv and many other. They all points to the same fake server, so if you've got an account, it will work on all of them. You can check this by extracting or installing the file, then running strings command in shell against these files.

    Warning: There is no clear indicator, whether your transactions are real or fake.

  13. Now, from whichever FakeBroker website you download the platform (the only difference are the filenames), they all are pointing to the same demo account server (you can find its IP by opening config/FakeBroker-Live.srv file).

    Warning: At the time when they applied for the license from MQL5, it could be a live server, but they can swap it anytime and you can't prove it.

  14. For the next weeks, they generate a good profit on their demo account (they make you to believe it's real). They keep you updated every few days, telling how hard it was to generate this profit (despite there are only few transactions). They don't need stop losses, as they've got a bunch of experienced scammers who're staring at the screens overnight, so you don't have to worry about it. They keep telling you about the trust and how sure they are.

  15. When they earn some trust, at some point you get redirected to more experienced scammer, so he can ask you about your personal life, family, plans and how much you earn, so they can calculate how much you can afford in order to deposit for their extra one-time offer deal, and of course, you need to be quick to make the decision on the same day.
  16. After your second deposit, they won't call you any more to your phone, but they'll use some one-time Instant messengers (such as Skype, since it won't expose their IP) registered with one-time-use Live account. It's better for them, as they don't have to spend on the phone bills.

  17. Guess what, they've now tripled your amount within a short period of time. They've found a holly grail.

    MetaTrader 4 platform, Forex, SunCapital-Live Account History, scam

  18. Since now they gained your trust with their unbelievable performance and professionalism, you are now part the final phase of the investment. They will ask you for the money which you can't easily afford for their unbelievable project where you can be rich within a month, so you can afford to buy a house or anything you like (all dreams come true). Since you can't afford it the deposit they're asking, they still want to help you to get into this project, any smaller amount (whatever you can afford right now) is good for them, however, they warn you about the risk. Of course, you can pay in installments every week to lower the risk (free margin), but you've been warned.

  19. The final phase of the scam. Whatever amount you've paid (big or small), the investment this time went wrong. What the coincidence. They've opened big positions which blew your account within few minutes to minus. What a tragic.

    MetaTrader 4 platform, Forex, SunCapital-Live Account History, scam

    "I am very sorry to tell you that the account now is empty, because of a fast rapid Bitcoin movement as a result of release data from US. There was nothing we could do about it."

    "The money was lost in the market and it happens the sometimes you win sometimes you lost."

  20. Now, they want to "help" you to recover the account, as it "happens", but will make sure it won't happen again. If you're rich, they may also ask you to give back the credit which they gave you for free, as they'll have to give it back to the bank (as it was a loan given to you). Since in Forex, the losses can exceed deposits.

  21. The last phase of the scam is to cut you off and lock your account for any disrespect reasons, so you won't find them easily, and you won't have any evidence of their existence.

    "I am going to cut you off from Skype, because you are very rude and disrespectful."

    "Don't talk to me anymore, don't write me. Our business is finished."

Tips and tricks

  • Record any phone or Skype conversations.
  • Take the screenshots of everything you think can be used as the evidence.

  • Don't give them any clues that you may know, as they'll cover their tracks immediately.

    For example, when I've told them that their withdrawal form got a different company logo on their website, they put me on hold and the file got removed, and the associated website has gone blank. When I told them about Wayback Machine next day, that you can still see it archived, after that, they put it back. So they learn very fast.

Similar situation with Sigma Option broker (I had the account with them as well), when people start complaining about not being able to withdraw their money, out-of-blue they've put their website to maintenance mode and disappeared. So the same could happen to this company, and 26+ other.

Resources

Check the facts

Here are few facts to check:

Actions to take

If it's a scam, then here are the actions to take:

In addition, if you're UK's citizen, you can:

kenorb
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  • I thought you said that not being on the FCA register wasn't important when I pointed it out... or did you change your mind? – MD-Tech Mar 09 '18 at 15:16
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    @MD-Tech I know, but you can still report them at FCA website, but I don't know if that changes anything. It's more like checkpoint for further victims to give red flags. I'll share my resolution solution once I deal with it. I'll try the chargeback approach first and see if that'll work, but first I need to find some solid proof on them (as withdrawal takes up to 5 working days). – kenorb Mar 09 '18 at 15:18
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    actually spread betting and binary options companies are now (since 04/01/2018) required to register with the FCA, I checked after work yesterday but never wrote it up! – MD-Tech Mar 09 '18 at 15:19
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    Great self answer! – Masked Man Mar 09 '18 at 15:42
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    If you've had accounts at two different scam broker sites, you're almost certainly on a "sucker's list" that will mean you're the first to hear about all the new scams. Be very careful and good luck. – David Richerby Mar 10 '18 at 13:10
  • @DavidRicherby What is the difference between this and a Hargreaves account? Both will never give you your money back :D – Cloud Mar 12 '18 at 09:46
  • @DavidRicherby With Sigma Option, I thought I lost the money for real, as I put the wrong deals myself and there was a brexit on that day, so the volatility was out of the charts, it wiped out my account, so I blamed myself, not them. They didn't show the great progress, it was more like 50/50 progress. But at that time I didn't know they were scammers until now. Definitely I'm on some "sucker's list", got too many calls like that, probably they're selling my details somewhere on the black market. I need to work more on my assertiveness and not to trust brokers. – kenorb Mar 12 '18 at 11:56
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    @kenorb It's not about not trusting brokers. If someone calls you, they are a scammer. If they are promising the chance astronomical returns or even modest returns with withdrawal conditions, they are a scammer. There are big, nice banks and brokers in the United Kingdom that will gladly do business with you. Use them. – Lan Mar 12 '18 at 16:22
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    So in few hours you went from arguing they're legit, to posting this super detailed answer on how this is scam. Did you change your mind so quickly? Nonetheless, tons of good information, +1. – void_ptr Mar 14 '18 at 04:01
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    I'm glad you came around to understanding that this is clearly a scam. FYI, Panama is not an island. You might be thinking of the Cayman Islands? – Eric Lippert Mar 14 '18 at 06:37
  • I would reconsider your position on the FCA/FSA. They do a much better job at protecting you than some of the other regulatory agencies. As for "Binary Options" which you cite as being respectable non regulated business, as a Derivative Risk Developer, BOs are high risk instrument with exorbitant margins and absolutely zero legitimate usage. I understand if you aren't risk adverse, but even so there are plenty of high risk investment firms in the UK you can use. However, I REALLY suggest you put your money into an ISA. – Aron Mar 14 '18 at 10:29
  • Very detailed an inside look at the scam artists' creation. +1 – Leon Mar 14 '18 at 14:00
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    @void_ptr, this is a fascination combination of question, comments and self-answer (especially considering the short time between question and answer), for sure. I guess kenorb is playing some sort of meta-game with us (potential victims of the scammers) to drive home how "real" the scam seems to be, playing advocatus diaboli himself on some meta level. Very nicely done! – AnoE Mar 15 '18 at 06:38
  • @AnoE Note that the first version of this answer was posted at around the same time than the last comment of OP to the question; and was substantially less comprehensive. Have a look at the edit story ;) – Marc.2377 Mar 15 '18 at 09:17
  • @AnoE Got the evidences which I need and can't disclose all for safety reasons, will post more soon, I know about their scam, because I've missed their last phase, this is where the break lose. Normally they blow the account of the client and they blame him for that, they lock you down and are covering the tracks, in my case I had the money and pressured them to proceed with withdrawal same week. They were crying over the phone they it's not possible and they cannot do it, they need to burn my profit first. Got even the recordings. They did too many mistakes. – kenorb Mar 15 '18 at 10:59
  • Yeah, all is well. Good luck with your case! @kenorb – AnoE Mar 15 '18 at 12:00
  • @kenorb Hi, just wondering if there's an update on your case yet? – Daan Jul 19 '18 at 12:49
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    @Daan Bank approved the requested chargeback after given the evidence (including phone recordings), 1st-time 3rd party bank refused it, but after my bank's 2nd attempt it worked (on misrepresentation basis), took few months, but got all the money back, so that's great. Applied for it on my own, without any solicitors which they charge a lot. Will update/improve post when got some free time. Related FPA's thread. – kenorb Jul 19 '18 at 14:00
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    @kenorb That's very good news for you man. I hope you learned your lesson and not get into similar troubles later on. Happy to see you got it fixed, congratulations. – Daan Jul 19 '18 at 14:48
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    This is incredibly detailed info and a great self-answer, but reading this almost a year after the fact I'm a little confused by the timeline and just curious to know what happened. Were you actually scammed? Did you recognize the scam before or after posting? In the comments on the Q, it seems like you were not convinced it was a scam, but based on the answer, it's clear you understand what happened. – dwizum May 21 '19 at 15:07
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It is a scam. There are quite a few websites with different names but same layouts.

Generally difficult to get money back. You can try legal recourse

Found out one more website.

Related question I made an investment with a company that contacted me, was it safe?

Dheer
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    xtradefx.com is newly registered (8/01/2018), and we can read here that Naveen Margan is the owner. I'm not sure if that's the same person (whether fake or not). Maybe the whole thing is some kind of broker business franchising using the same model and templates? – kenorb Mar 08 '18 at 22:23
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    @kenorb: It is not a legitimate franchising business. You are working very, very hard to believe that this is not a scam. You got scammed. That sucks. The sooner you believe that, the sooner you'll stop getting taken. Today would be a good day to examine what factors led to you being taken in by a confidence scam, to help inoculate you against future scammers. – Eric Lippert Mar 08 '18 at 22:41
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    Man, when the top of the page says "regulated and licensed", you immediately know it isn't. – Martin Argerami Mar 09 '18 at 02:49
  • This, this and this also seem to be the same. In fact a Google search for "about us" "forex trading" "partnerships" "online trading tools" "support" will find you loads of them. – h2ooooooo Mar 09 '18 at 17:41
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You got a call from someone, out of the blue, asking you for money. How is this not a scam? Cold calling is a good indicator of a scam. You also seem to be in denial of that fact that you’ve been scammed. If you want to be 100% sure it is a scam, simply ask them for your money back. Any legitimate broker will return your money.

user31652
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    Many perfectly reputable investment businesses make perfectly legal money cold-calling 'high-net-worth' individuals and asking them to invest in things. It's simply another form of advertising. – Valorum Mar 10 '18 at 00:42
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    @Valorum Says the cold caller. – user31652 Mar 10 '18 at 02:07
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    Actually no, but neither am I some rabid "cold-callers must all die for having the temerity to phone me" fanatic. – Valorum Mar 10 '18 at 08:22
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    @Valorum many perfectly reputable investment business's fail to beat the market... – NPSF3000 Mar 11 '18 at 08:32
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    @NPSF3000 that doesn't mean they're scams, it just means they suck at what they do. – Demonblack Mar 12 '18 at 18:04
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    @Demonblack. Tomato, tomato. – NPSF3000 Mar 12 '18 at 19:15
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    There is no legitimate broker that uses cold calling as a marketing tactic. Cold calling is designed to get unsuspecting people to buy into the caller’s scam. Most cold callers call people who aren’t even investors, such as the inexperienced person who was scammed here. Cold callers also buy lists of phone numbers belonging to high-net-worth individuals. They then use these lists to scam those individuals (yes, rich people get scammed too). If you want to learn more about scammers that use cold calling, then watch the movie The Wolf of Wall Street, which is based on a true story. – user31652 Mar 12 '18 at 22:04
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Here's how the scam works.

  1. Find a "hot trend" that people hear a lot about, but don't really know that much about. BitCoin is always in the news, and there's already a lot of spam flying around about ForEx.
  2. Design a product that is designed to give new investors access to these "hot trend" markets. Make it a little bit clunky and technical on purpose, so investors can't quite grasp what is going on, but it mostly looks right.
  3. Aggressively market this product to these newbie investors -- who can be talked out of money, have an interest in the "hot trend" but unfamiliarity with the mechanics. Part of the customer screening is specific questions to gauge their familiarity.
  4. Have a system capable of generating fake data that looks correct and believable to someone who is not an experienced expert.
  5. Contrive a rule that the customer can't take their money out for an initial period after investment. This is vital because...
  6. Get the customer initially invested, then
    • Show them some initial wins "on paper"
    • ask for more investment
    • show them more wins
    • ask them for additional investment still - in the usual way of scams
    • this house-of-cards collapses if they want to pull their money out

What actually happens is the money is gone. What remains is smoke and mirrors designed to conceal that fact, and to pry more out of you.

Stop investing

Really, investment is an essential wealth strategy. But if you gravitate toward schemes like this which aren't even hare-brained, then you should simply stop investing until you learn what on earth you are doing, and start with Suze Orman or Dave Ramsey and a well rounded understanding of consumer finance generally.

The one thing you should invest in, is your retirement, via your country's equivalent of 401K or IRA, and you should invest in the market, and do it via index funds (and if you need more on that, read John Bogle's "Common Sense on Mutual Funds", but Suze/Dave first). This should be the most simple and boring choice possible.

Harper - Reinstate Monica
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  • There are a lot of weirdly computed and "exciting hot trend" index funds too, enough so that scammers can conceal themselves in that verbiage. Might be worth pointing out what "simple and boring" means (for the US it would have been Indexes on DJIA, Nasdaq, and S&P500, run by Vanguard, Fidelity, SPDR, or BlackRock/iShares... and above all, listed on Morningstar) – Ben Voigt Mar 11 '18 at 16:20
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I'm not saying whether this is a scam or not, although it seems VERY fishy, but here's how the scam could work in a way that fits the facts:

  • You give them a thousand Euros, which they "invest" for you. After a few weeks, they astound you by showing you that you now have 2,000 euros in your account. WOW! A 100% increase in a few weeks!
  • They convince you to give them another 5,000 euros, which then grows to 14,000 euros. You have "earned" 10,000 euros in just a few weeks! You can even see that money in legitimate accounts.
  • They have now "earned your trust" and convince you to give them 20,000 euros.
  • They use that 20,000 euros to "magically" earn 10,000 euros for two new suckers and pocket the original 6,000 you deposited. Your money is gone.
D Stanley
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Well, first of all, if they're investing, they're not a "broker", they're a fund manager. Standard practice is to have those two roles separate: there's someone who decides where to invest the money in the fund, and a different person has the actual power to allocate the money. Those roles not being separate is a major red flag. The Madoff fund, for instance, did not have these roles being separate.

Some basic questions:

-If something goes wrong, is there a person to sue? As in, you have the legal name of an actual human being, not just the name of a company? Can you verify this person's identity? What sort of licensing does this person have?

-Where are the profits coming from? How risky is it? Are the claimed profits plausible (note: 200% a month is not plausible)? What obligations does the fund have towards you?

-Is there a separate financial entity holding the assets, or are they buying the assets themselves, "on your behalf"? Does the fund manager have direct access to the money? That is, if they want to just move it all to their personal bank account, is there anything stopping them from doing so?

-Can they verify that they actually made the trades they claimed to make?

-How are they, personally, making money? That is, what fees etc. are they taking?

Note that even if it's weren't a scam, it would be at best a highly risky investment based on shaky assumptions of market behavior.

Acccumulation
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Reputable brokers and fund managers charge fees, they don't give you "100% Equity Credit on top" whatever that is.

I notice you didn't mention which shares or investments the broker claims to be holding for you. Did you check them out independently?

Sorry but I'm 99.9% sure you have lost your money.

Try telling them you have a mate that wants to invest $50,000 but he's waiting to see if you can actually get any money out. Then ask to withdraw half of your original investment. See if they fall for it. My guess is you won't get even that.

ColinWatters
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  • I've got the account with XM broker and they're adding extra equity credit on top of my balance (not 100%, but some) when I deposit, and they're not scammers. – kenorb Mar 12 '18 at 23:34