Beware! SandtonCapital Markets is an offshore broker! Your investment may be at risk.
Don’t put all your eggs in one basket. Open trading accounts with at least two brokers.
SandtonCapital Markets is a Forex brokerage registered in South Africa. It provides a web-based trading platform, not the MT4 trading terminal, and an extremely generous leverage of up to 1:200. Furthermore, there is a wide range of trading products from which to choose and a required minimum deposit of $100 which is about the industry average.
SandtonCapital Markets regulation & safety of funds
According to the website the company behind the brokerage is registered in South Africa by the name North Point Financial Services and even gives a license number 49217.
Furthermore, the brokerage claims that it falls under the regulatory oversight of the local FSCA as an authorized financial services provider. After checking with the online registry of the South African regulator we did find the broker brand among the list of licensees.
Even though the regulatory body in South Africa cannot compare with the UK’s FCA for example, it is still legitimate and a license by its does carry weight in Forex trading. We consider the license a big advantage for traders. Furthermore, the brokerage provides a web-based trading platform, however, we were unsuccessful when attempting to register for a demo account. The brokerage does inform through its website that the leverage extended to traders is 1:200 which is quite generous. All brokerages registered in Europe have to comply with a leverage cap of 1:30 which on the other hand eliminates the possibility of losing more than your initial deposit – a big risk when trading with a high leverage.
Traders needn’t have to worry themselves with such risk if they choose to trade with a brokerage regulated and authorized by a prestigious regulatory agency. Such agencies are the FCA in the UK or CySec in Cyprus which have been leading names in Forex trading for some time now. Their regulatory framework is composed of a number of strict rules which prevent clients from falling victims to fraud. Such rules include the segregation of accounts which assures that commingling with the client’s money is not possible. Furthermore, a license by such a regulatory body entails participation in a financial mechanism by which clients may be compensated if they suffer losses due to fraud or bankruptcy. The FCA provides up to 50 000 pounds per person, while CySEC guarantees up to 20 000 euros.
SandtonCapital Markets deposit/withdrawal methods and fees
Something quite strange for a regulated and legitimate brokerage – we couldn’t discover what the available payment methods are. Furthermore, while attempting to read the terms and conditions of the brokerage there were technical difficulties and “website error”. We could not find any disturbing withdrawal provisions on the brokerage’s website, as a matter of fact the broker states that there are no withdrawal fees.
However, due to the obscene amount of scamming in online Forex trading, we always advise traders to 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?
Unfortunately, the possibility of a scam looms over almost every trade in forex, especially if you are dealing with an unregulated brokerage. That is why we believe traders should be acquainted with the methods of a scam. Here is how it would typically go about:
Through clicking an ad with promises for fast money, you will be redirected to a website such as Bitcoin Evolution or Crypto Cash 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 motive here is quite straightforward – traders have a limited time window for filing a chargeback with their bank and get their money back. The “recovery department” will simply want to mislead you into missing this crucial period and, along the way, losing any chance you might have of getting the money back.
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. Furthermore, due to the high instances of fraud – both Visa and MasterCard have decided to sidestep scammers as best they can in Forex trading. The first thing we have seen so far is that MasterCard has increased the previous time period of six months for filing a chargeback to a year and a half with their rival Visa expected to follow suit in December.
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!