Beware! SwissCFD is an offshore broker! Your investment may be at risk.
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SwissCFD is an offshore broker offering a wide range of forex pairs and other CFDs on gold, silver, oil, indices and crypto currencies with three account types, leverage as high as 500:1 and the MetaTrader5 platform.
And although spreads look good – starting form 1 pip with their Standard Account, there are a number of issues regarding the broker that make us suspicious about the offer as a whole.
SwissCFD regulation & safety of funds
SwissCFD is owned and operated by Brown Fox Limited, a company based on the Marshall Islands, but all financial payments are handled by Pexil Financial OU, which is based in Estonia.
SwissCFD is not a regulated broker and that makes trading with them extremely risky. Bear in mind that unregulated brokers in general are basically unaccountable for the way they handle your money.
With SwissCFD, however, things are even worse as they have been blacklisted by the Italian financial regulator CONSOB for targeting European customers without authorization – EU is a strictly regulated market, where all brokers are obliged to get a license from one of the official national regulators like CONSOB in Italy, the Financial Conduct Authority (FCA) in the UK, BaFin in Germany, or the Cyprus Securities and Exchange Commission (CySEC).
SwissCFD deposit/withdrawal methods and fees
SwissCFD says to accept payments with VISA, MasterCard, UnionPay, Neteller, Skrill, PayPal and bank wire. The minimum deposit requirement – 500 USD, however is twice higher compared to the one most other brokers would usually ask for.
And there are a couple of rather peculiar clauses in the SwissCFD Terms and Conditions, which we should mention as well.
SwissCFD appears to be offering “MAM trading accounts”, which supposedly use trading algorithms and where your funds will be locked for at least 6 months.
This however has nothing to do with the so called social trading platforms like Zulu, where you can choose to follow the trades of experienced traders. Here SwissCFD says they will manage your account, while actually acting as market makers, and that simply means they will be in a conflict of interest.
Bear in mind that a market maker like SwissCFD (they acknowledge that in their Terms and Conditions) – makes money whenever traders lose.
Also be aware of any trading bonuses that the broker might offer you as they will be linked to some special withdraw conditions like a minimum trade volume requirement of at least 3 lots or 300 000 USD for every 10 USD of bonus you have accepted. And SwissCFD says that unless you meet that minimum trade volume requirement you will not be allowed to make any withdraws.
On top of that SwissCFD reserves the right to change their bonus conditions whenever they feel like doing so, and to impose withdrawal limits and withdrawal fees in their system.
Quite often such withdraw conditions are used by scammers to cancel your withdraw requests.
How does the scam work?
People usually end up with a scam broker, after they have been lured by one of the so called robo scam websites like Bitcoin Profit and Brexit Trader, which currently are all over the internet. There you might be tempted by a well short video ad, telling you how easy you can get fabulously rich, by just investing a small amount with some innovative trading app. And if you do register, leaving your phone and e-mail, in a second you will be transferred to a unregulated, offshore broker, where you will be invited to deposit about 250 USD.
And your first trades will go great – it will seem that you are making money with every move, and the figure in your account will soon double. That however will note be real. Your trading account will simply be manipulated with the sole intention that you will be tricked to deposit a much larger amount. And exactly that will be the suggestion of your “senior account manager” – if you really want to make some big money, you will definitely have to invest at least 10 000 USD.
And most people do invest that kind of money, without ever realizing they have been scammed until the moment they try to withdraw some of their cash. Thane all of a sudden it turns out they are not permitted to withdraw because of some minimum trade volume requirement, linked to a trading bonus they have received.
The pretext might be different, but in the end it will all come to the same. All your withdraw requests will be duly canceled.
What to do if scammed?
In case you have been scammed the only plausible option you have is to file for a charge back with VISA or MasterCard, if by any chance you have payed that way. Fortunately both card companies will allow you to do that within 540 days.
And if somehow scammers have tricked you to reveal your credit card number or online banking password, immediately change the password and block your credit card.
And one final word of advise. Forget about the so called recovery agencies. They will not recover your funds, but will simply charge you some fees in advance and that will be the end of the story.