Beware! This is an offshore broker! Your investment may be at risk.
RECOMMENDED FOREX BROKERS
Don’t put all your eggs in one basket. Open trading accounts with at least two brokers.
GMPFX is a brokerage owned by the company Global Prime Limited in Vanuatu. It requires a minimum deposit of just $2.50. On its MT4 trading platform we see a spread of 2 pips and a leverage of up to 1:2000. As we can see – the trading conditions of the brokerage are nothing out of the ordinary, with the exception of the leverage. GMPFX offers traders among the highest leverage we have seen and we must say – with such a leverage, there is a risk of suffering heavy losses, even such that may exceed the traders initial deposit.
GMPFX regulation & safety of funds
After checking with the Vanuatu authorities we can confirm that GMPFX is licensed with VFSC. However, being registered in Vanuatu, a country in the middle of the Pacific ocean and lacking any far-reaching reputation in the trading world, certainly doesn’t carry a lot of weight. Nevertheless, not being included in the regulatory framework of a reputable agency such as the CySec exposes potential clients of GMPFX to serious risks:
No safety – We have no assurance for the safety of the clients funds, besides the supposed cordiality of the brokerage. Without regulation, we have no guarantee of the segregation of accounts i.e. the clients funds may well be mixed with those of the company and liable to all sort of illegal encroachments on part of the broker.
No capital requirement– Compliance with a regulatory agency such as the FCA also requires the broker to have a starting capital of € 730 000 which significantly lowers the risk of them being frauds, since not many scammers can pull through with such an amount.
No compensatory scheme– Potential clients of the brokerage do not participate in any compensatory scheme by which in the unlikely case the brokerage goes bankrupt, trader’s losses will be covered by up to € 20 000 per person.
GMPFX Deposit/Withdrawal methods and fees
Potential clients of GMPFX may deposit or withdraw funds via Fasapay, Maybank, CIMB, Public bank, Ambank group. We always view it as a welcoming sign when a brokerage offers a variety of payment methods for clients and GMPFX is certainly lacking when it comes to this feature of a brokerage.
How does the scam work?
Scamming can be done through a number of different ways in the trading world, but the usual routine is as follows:
A pop-up ad will come up with a nice-sounding promise of making fast money. The website will want your address, phone number and email. Only minutes later, that same data will be shared with a number of brokers who will begin calling you with a number of trading offers. After a few minutes you may budge and deposit with them a sum of $200-250. You may not have realized it, but with the deposit – you will have handed the broker a nice commission of $50.
After the initial deposit the scam, however, is not complete, and more follows – the so-called retention. Your introductory broker will redirect to senior scammers who will have big plans of you putting up even larger sums. After investing further money with the brokerage your trading performance will worsen and you will begin to want to cash out with only minor losses.
However, the scammers will not be finished with you just yet. You will most likely be redirected to the “recovery department” where yet another representative on the phone will begin pleading with you not to withdraw right now, but instead wait it out. The ugly purpose of this is to mislead you into waiting six months or more. This is done, because you have only six months to file a chargeback with your bank, otherwise the money will be lost for good.
What to do if scammed?
In the unfortunate case you are scammed, there may still be a few available options for you, although, we cannot guarantee they will work.
You may contact your bank or credit card provider and file a chargeback, as was mentioned above. You must do that within six months after your initial deposit with the brokerage.
If, however, you have provided the broker with your credit card details, immediately cancel your credit card. If you have given information regarding your online banking pass – you should switch it asap!
Take notice that so-called “recovery agencies” should not be trusted. They prey on scammed clients with promises of getting their money back, but nothing of this sort happens. If you hear talk of “up-front payment” from someone, claiming to be a recovery agency, we advise you to immediately hang up.