Beware! 10Capital is an offshore broker! Your investment may be at risk.
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10Capital is a CFD brokerage which emphasizes on crypto currency trading supposedly registered in the Czech Republic. It provides a web-based trading platform and a spread of $134 on BTC/USD. Clients have at their disposal a wide range of crypto pairs. The required minimum deposit is $500 which is quite excessive in our view.
10Capital regulation & safety of funds
The brokerage chooses not to disclose much information about itself. We do come across the company name – VIVZ Odštěpný Závod – which is supposedly registered in the Czech Republic. We also come across an Azerbaijan address for the company that process the payments. Here is a screenshot:
The Czech Republic is a member-state of the EU and all the guidelines of ESMA are in full force in the country. However, we find no mention of a license and we can safely conclude that 10Capital does not fall under any regulatory oversight. However, the brokerage does inform us about its trading conditions and it provides a web-based trading platform, which, however is not impressive and quite confusing in our view. Here is a screenshot:
On it we could see a spread on BTC/USD of $134 which is quite high in our opinion and not very favorable for traders. We further consider it disadvantageous for traders that the brokerage provides a web-based trading platform and not the MetaTrader 4 which we consider the foremost trading terminal at the moment. The required minimum deposit of $500 is twice the industry average and also excessive in our view. All in all, going through the brokerages website we kept coming across red flags after red flags and we believe that potential clients may be open to substantial risk.
We urge traders to exclude such risk in trading by only associating with brokers regulated by prestigious regulatory agencies, such as the FCA and CySec, which require compliance with a number of strict rules that give significant assurance for the security of the clients funds.
The segregation of accounts is among the rules which are especially important in the trading world, because it drastically lowers the risk of possible commingling.
Another is the participation in a compensatory scheme by which the client’s losses will be covered in the unlikely case the broker goes bankrupt or attempts to swindle traders.
10Capital deposit/withdrawal methods and fees
Potential clients of the brokerage may deposit or withdraw via Visa, MasterCard and Bank Wire. Popular e-payments such as WebMoney or Skrill are missing. Going through the terms and conditions of the brokerage we came upon very worrisome withdrawal conditions.
As you can see from the screenshot – the brokerage charges a withdrawal fee of $25, as well as levy a $50 service fee on accounts that have been inactive for more than three months. Furthermore, we also come upon a minimum withdrawal amount of $100. Here is a screenshot:
Such conditions further incline us to suspect that the brokerage’s goal is to make money unethically off of clients.
This is why we advise traders to always put up only the required minimum deposit, instead of risking a bigger amount with no certainty. Afterwards, they may also try to withdraw a small amount in order to check for any unexpected fees or delays. Such fees and delays are usually the signs of a scammer.
How does the scam work?
Even though the forex trading world is extremely large and encompasses millions of people around the globe, the most common scamming is pretty simple and straightforward and as such – it’s not particularly daring to avoid. Here is a quick overview of how it is done:
Through clicking an ad with promises for fast money, you will be redirected to a website such as Bitcoin Evolution or Cashless PayGroup where registration will require you to give your address, email and phone number. After sharing your personal information, you will being receiving calls from brokers, compelling you to invest with them and win big. After a few minutes hearing their pitches, you decide to deposit some $200-250. And just like that – the scammers take a fat commission from this initial deposit.
After they are done with you, senior scammers begin working you into putting even more money. They say it’s the only way to profit from trading even more. After making the mistake of investing even further, you’ll begin wanting to get out of this and withdraw what you have left.
Unfortunately, the con-artists have no such thing in mind. They will now begin persuading you to wait it out and not withdraw right now. The angle here is pretty blunt – traders have a limited time period for filing a chargeback with their bank and get their money back. The “recovery department” will simply want to mislead you into missing thе crucial period and, along the way, losing any chance you might have of getting the money back.
It is important here to take notice that both Visa and MasterCard are taking measures to combat unregulated forex brokerages by classifying all forex transactions as high risk. And with the case Lite FinTech – they are correct in doing so. Furthermore, supporting their intention with clear actions – MasterCard has increased the previous time period of six months for filing a chargeback to a year and a half.
What to do when scammed?
As was mentioned above, scamming is quite the common in the trading world and, sadly, even you might suffer from it. In such an unfortunate case there still may be some available options for you.
You may contact your bank or credit card provider and file a chargeback.
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!
Beware of potential calls from self-described “recovery agencies”! They prey on scammed and vulnerable traders who are desperate to recover their losses. They will require an “up-front” payment to help you, but after paying them, no such help will be coming your way!