Beware! FXCoinClub 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.
FXCoinClub is a Forex brokerage registered in the UK. It provides a web-based trading platform, not the MT5 trading terminal and clients are extended an extremely generous leverage of up to 1:200. Furthermore, there is wide range of trading products from which to choose but a spread of over 2 pips which is above the industry average. The required minimum deposit is the industry average of $250.
FXCoinClub regulation & safety of funds
According to the website the company behind the brokerage is registered in the UK by the name Digitley Markets Limited. We remind readers that all brokerages operating on the territory of the United Kingdom hold the responsibility of being properly licensed by the country’s regulatory authority in the face of the Financial Conduct Authority.
Going through the online registry of the British financial watchdog we could not find mention of the company’s name which leads us to conclude that FXCOINClub is providing financial services illegally. This puts enormous risk in any dealing a trader may execute with the firm and we highly recommend traders steer clear of the broker.
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. With the FCA the compensation is up to 85 000 pounds, where as with CySEC it is up to 20 000 euro per person.
FXCoinClub trading software
Furthermore, the brokerage does not provide the MetaTrader 4 platform, instead there is a web-based platform. However, the MT4 is the foremost trading terminal at the moment and we always view it’s absence as a big disadvantage for the broker. Nonetheless, there is a demo account available for the web-based platform. Here is a screenshot:
And we could see a spread of 2.7 pips which is extremely high and quite unfavorable for traders. Furthermore, with unregulated Forex brokers business is always intertwined with certain uncertainty, however, we must point out that the selection of trading products is quite impressive and includes CFDs on indices, stocks, currency pairs and others. Clients are extended a leverage of 1:200 which is quite balanced but yet another sign that we have an unregulated brokerage on our hands since there is a leverage cap of 1:30 throughout Europe.
FXCoinClub deposit/withdrawal methods and fees
Potential clients of the brokerage may deposit or withdraw only via the standard Visa and MasterCard. We could not find any worrisome withdrawal provisions, however, we should highlight that many scammers choose not to disclose such information to would-be clients. There is turnover requirement for withdrawing from an account that has taken advantage of the bonus scheme, however, traders should have in mind that almost all brokerages have such provisions for their bonus promotions. Without proper information on the website we cannot be certain whether clients won’t be charged with any unexpected withdrawal or deposit fees once they invest.
Having in mind all that was stated above, 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?
Information is a pretty solid criteria for judging a brokers legitimacy. Scammers would not share much of their information, because precisely there inconsistencies and irregularities may appear which expose the whole set-up. A good example is this very broker and the misleading information it gave regarding its regulatory status.
After informing themselves for the brokers trading conditions – traders should be well-versed in the way of the scam:
Through clicking an ad with promises for fast money, you will be redirected to a website such as Bitcoin Evolution or Crypto Revolt where registration will require you to give your 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 peer 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!