Beware! FXReview 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.
FXReview is an offshore Forex brokerage registered in St. Vincent and the Grenadines. It provides a web-based trading platform, not the MT4 trading platform and the leverage extended to traders is quite generous at 1:200. The required minimum deposit is just the industry average of $250 but the spread is quite unfavorable at 3 pips on EUR/USD.
FXReview regulation and safety
On the brokers website we read that the broker brand is owned and operated by a SVG-based company with the name High Concept Holdings LTD. Saint Vincent and the Grenadines is a well-known offshore zone and a preferred location for shady brokerage.
We remind readers that the government of SVG has multiple times publicly stated that it does not oversee Forex trading and thus we may safely conclude that not only is the brokerage not regulated. Furthermore, trading with an offshore, unregulated brokerage hides a lot of risk. There may be commingling which means that the brokerage may commingle together the finances of the firm and the finances of the clients. Furthermore, not even mentioning the name of the company is cause for concern since this means that the website is basically anonymous and the people behind it answer to no viable authority. Overall, the lack of regulation inclines us to suspect that potential clients of the brokerage may be open to substantial risk.
Overall, the lack of regulation and the regulatory warning inclines us to suspect that potential clients of the brokerage may be open to substantial risk.
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.
FXReview trading software
Putting all this aside – the brokerage does not provide the MetaTrader 4 trading platform, a big disadvantage for traders since it is the foremost trading terminal at the moment equipped with features such as almost a 100 market indicators, as well as customizable trading robots. Instead, we are presented with a web-based platform. We further were able to get a look at through a demo account. We must take notice of the availability of a test-drive since it is not so common among unregulated brokerages.
We could see a spread of 3 pips which is twice the industry average and quite higher than what we would consider favorable. We do, however, see quite an impressive selection of about 40 trading products ranging from CFDs on stocks to currency pairs and crypto pairs as well. This is always advantageous for traders and we highlight it as a definite plus for the brokerage.
FXReview deposit/withdrawal methods and fees
Going through the terms and conditions of the brokerage we did discover some troublesome provisions. Here is a screenshot:
We discover that FXReview charges withdrawal fees for all payment methods. They are as follows: for credit cards and wire transfer 0.3 percent and for Bitcoin 1 percent or a minimum of $20. It appears all accounts that have had zero activity will be charged upon withdrawal the sum of $50. Furthermore, there are ambiguous statements regarding the conditions upon which a client is eligible for withdrawal which is a definite red flag in our book as well. Furthermore, the brokerage outright states in the terms and conditions that it reserves the right to change the bonus withdrawal condition as it sees fit which is a major warning sign. This practically means that traders may not at all be able to withdraw their funds.
There weren’t any other noteworthy provisions, but we do remind readers that many scammers choose not to disclose such information to would-be clients. 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. 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 DaxRobot or CryptoContracts 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 Traderia – 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!