Money is one of the most highly sought-after commodities in the world, and there are many people trying to take advantage of inexperienced investors. These scammers will convince you to deposit your money into their bank account, but when it comes time for you to withdraw your money, they will disappear. To avoid being a victim of these scams, be sure to do your research and know what to look out for. There are some common warning signs that can help you spot a high-fee forex scam.
What is a high fee forex scam?
A high fee forex scam is when you are asked to deposit money into a bank account with a high-interest rate, but the account will be closed or the amount of money deposited is not what was promised. For example, a company might offer an amazing deal on forex trading that promises to return $2,000 within two weeks.
However, if you deposit $1,000 and the company only gives back $500—you just lost $500! Besides losing your money and being left in the dark (without your deposited money), you also have to worry about getting blacklisted as well.
Here are some warning signs to look out for before depositing your hard earned cash into someone’s bank account:
* The person who solicits you wants you to deposit more than one currency into their account.
* The person who solicits you keeps changing the terms of their offer.
* The person who solicits you asks for a large margin on your trade.
* The person who solicits you asks for personal information like social security numbers or passport numbers.
* The person who solicits you does not provide an address or phone number so it is difficult for customers to contact them.
How to avoid being scammed by high fees
Scams that offer high-fee trading are, unfortunately, a reality in the financial industry. Scammers know that people looking to make money quickly are more likely to put their faith in someone they don’t know. With this in mind, scammers will try their best to convince you that your investment is safe and secure.
Here are a few warning signs you can watch for:
1) High turnover rates
High turnover rates are often associated with scammy businesses, like forex trading because it means the company is constantly trying to find new customers who may be susceptible to being scammed. By offering higher profits and lower fees, these companies can quickly increase their customer base and have more people invest in them.
2) Unclear terms of service
If there’s anything sketchy about the terms and conditions of an investment company’s website, be wary of it. When reading through the terms and conditions, be sure to look for any questionable parts that might indicate that something isn’t right. For example, if one part of the website says “yes,” but another part says “no,” then take note of this inconsistency. If a company has a lot of different policies on their website without clearly explaining what each
Warning signs of a forex scam
It starts with the name. If a company is called anything other than what they are, this could be a red flag. For example, a “Forex Trading Company” should not be named “Forex Trading.”
The way the company conducts business is another warning sign. This includes common signs like not answering their phones or emails and making large withdrawals without you ever seeing your account balance change.
The last warning sign is how the company charges a fee for using its services. Many forex scams charge up to hundreds of dollars in fees when you are just trying to withdraw your money from their bank account. These fees are designed to scare you into thinking that your money will be confiscated and that you’ll need to pay more than $100 in order to get it back.