Beware! ProfitSystemFX 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.
ProfitSystemFX is a Forex brokerage registered in the UK. It provides a web-based trading terminal, not the MetaTrader 5 trading platform and an absurd leverage of 1:800. Furthermore, the website flaunts with a wide range of trading products, the required minimum deposit is the standard $250, however, further trading conditions remain undisclosed.
ProfitSystemFX regulation & safety of funds
The brokerage claims to be owned by an unnamed company which is supposedly regulated by both CySEC and Belize, by the Financial Service Commission of Belize, however, no further corporate information is disclosed which renders the website anonymous. This strikes us as quite strange since CySEC is among the leading financial regulators in the world and it wouldn’t be giving licenses to websites that choose not to share basic corporate information such as the company name.
On the other hand, Forex brokerages in Belize have to guarantee legitimacy by having at least $500 000 in starting capital. However, even though a license by the IFSC is better than nothing, it still does not carry the same weight in Forex trading as a license by the NFA in the US or the FCA in the United Kingdom. Upon running a check through the online registry of the Cypriot financial regulator using the reference number on the website, we discover it belongs to a legitimate company registered with the name Windsor Brokers ltd. This means the brokerage is providing financial services without proper authorization and is stealing the corporate information of regulated firm in order lend itself legitimacy. We highlight the danger in doing business with an anonymous website since the people behind it do not answer to any authority and have no reason to uphold the client agreement. On top of this, the Italian regulator CONSOB has blacklisted the brokerage and suspects it of being involved in scam operations. It is safe to say that there is tremendous risk on any transactions interested traders may conclude with the brokerage and we deeply recommend they look elsewhere for viable trading options.
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.
ProfitSystemFX trading software
The MetaTrader 4 trading platform is supposedly supported which is something we always consider an advantage since 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). However, upon downloading it we discover it is actually provided by a third party which renders any trading conditions presented as meaningless. Even though it’s not uncommon for unregulated brokerages to offer clients trading terminals, supported by a third party, we always recommend to readers not to risk it and steer clear from such offers.
ProfitSystemFX deposit/withdrawal methods and fees
We did not find any stated withdrawal fees either, however, dealing with unregulated brokerage we may never be sure whether they wont charge unexpected fees once the clients have deposited their funds. There are also withdrawal conditions pertaining to accounts that have taken advantage of the bonus promotion. A trader has to achieve a certain trading volume in order to be eligible for withdrawal which is purposefully excessive in order to impede any trader from actually receiving his money. Legitimate brokerage which are regulated in Europe do not offer such promotions and even if they do, the information regarding potential withdrawal requirements is always presented straight-forward on the website, not hidden away in the terms and conditions.
Such website are also the reason 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 with the case Btcoinpro – 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!