Beware! Xinvest is an offshore broker! Your investment may be at risk.
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Xinvest is a CFD brokerage we believe is based in Bulgaria. It provides а web-based trading platform, not the the MetaTrader 4 platform. The required minimum deposit is the industry average of $250, however, further trading conditions are unclear and crucial information is missing.
Xinvest regulation & safety of funds
Reading through the terms and conditions of the brokerage we discern that the website is actually operated by a Bulgarian company with the name General Dimp Ltd and address str. Korten 31. We remind readers that Bulgaria a member-state of the European Union and online Forex trading is duly integrated within its regulatory framework which is modeled after the ESMA guidelines.
However, we find no mention of a license by the Bulgarian authorities – thus we may safely conclude that the brokerage Xinvest does not fall under any regulatory oversight whatsoever. For the sake of diligence we ran a quick search on the online registry of the Bulgarian Financial Supervision commission and can confirm that the brokerage is not licensed.
Another big problem with the brokerage is the lack of information on the website. Furthermore, it is obvious it attempts to pass off as a crypto exchange, however, this is quite far from the mark since Xinvest probably only offers trading on crypto CFDs which is quite different from the crypto exchange’s products. We have come across several such crypto brokerages based in Bulgaria and we have good reason to believe that they are the spawns of one or two scam operations and as such we do not recommend them to interested traders. In other words – we believe that any potential client will be exposed to a substantial amount of 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.
Xinvest trading software
However, the brokerage does provide a web-based trading platform, however, we always view the lack of MetaTrader 4 as a serious disadvantage. The MT4 is among the foremost trading terminals in Forex trading at the moment, close to 80 percent of users prefer it. The platform provides an advanced charting package, lots of technical indicators, extensive back-testing environment and a variety of Expert Advisors (EAs). Aside from that – although there is supposedly a web-based trading platform available we could not register for a demo account which means that a test-drive of the platform is not available for interested traders. We view this as a big disadvantage since a test-drive is the most viable and transparent way of getting acquainted with the trading conditions of the broker. Furthermore, there is no information on the website regarding the spread and thus we are left in the dark regarding the trading conditions which are the most crucial aspect in Forex trading.
Xinvest deposit/withdrawal methods and fees
On the website we find no information regarding the available payment methods for clients which is another big negative for the broker in our view. Usually in Forex trading clients may deposit or withdraw via at least the standard Visa and MasterCard, as well as bank-wire.
Going through the terms and conditions of the brokerage we did come upon provisions which are worth noting. There is a withdrawal fee of $30 which is quite excessive and definitely raises the cost of trading with the brokerage. Furthermore, there is a dormant account fee of $100 where every account that has been inactive for more than three months shall be charged. We consider the amount quite high and excessive. There are also withdrawal conditions pertaining to accounts that have taken advantage of the bonus promotion. A trader has to achieve a trading volume of twice the bonus amount in lots in order to be eligible for withdrawal which is purposefully excessive in order to impede any trader from actually receiving his money.
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 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!