MuganFX review – 5 things you should know about mfxbroker.net

MuganFX review – 5 things you should know about mfxbroker.net

Beware! MuganFX is an offshore broker! Your investment may be at risk.

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MuganFX is forex broker that also advertises trading in commodities such as oil and precious metals. It offers three types of accounts – Mini, Standard and VIP – depending on the amounts of deposits, and also presents Real and Demo Account options.


From the very beginning we noticed the website is not encrypted and connection to it is not secure. As your browser will tell you, you should not enter any sensitive information on this site (for example, passwords or credit cards) because it could be stolen by attackers. There are also links to muganfx.com which is also not secure and returns a 403 Error ”Forbidden”. These things should raise a flag with any Internet user, and are signs of lack of professionalism and / or shady practices.

This is not all, however. Trying to register for a real account also returned an error:


We did not have success with the demo account as well. The instructions say you can open such account in 3 easy steps. On the second step, however, we hit a wall as there is no registration form to open a Demo account. There are also missing images, as can be seen from the screenshot above, which are hosted on another domain, which cannot be reached – oldforex.muganbank.az.

Overall, the impression we get from the broker’s website is one of total incompetence that should immediately discourage potential traders. MuganFX does not succeed even in what is scam brokers’ usual objective – to implement a simple registration form in order to collect users’ personal information.

MuganFX regulation & safety of funds

Mugan FX LTD is headquartered in “Sent Vincent and Grenadines”. Here we see again a sign of ineptitude with the jurisdiction’s name misspelled. St. Vincent and the Grenadines (SVG) is an offshore zone that does not regulate forex trading and is often a safe haven for shady brokerages. The contact emails provided also use the forbidden domain we noted above – muganfx.com.

The website boasts to partner with household names in the financial industry, such as J.P. Morgan and HSBC. Scam brokers often employ such tactics – putting familiar companies’ logos – in order to trick potential clients’ into believing these institutions provide liquidity or financial backing to the broker. In the end these are usually empty claims.

Overall, we may conclude that MuganFX is NOT a licensed broker and does not comply with the regulations that organizations such as the Financial Conduct Authority (FCA) in the UK and the Cyprus Securities and Exchange Commission (CySEC) in the EU impose on their licensees. Such rules include a number of measures devised to ensure the broker’s stability, as well as the security of clients’ funds in case the broker goes bankrupt.

MuganFX Trading Software

MuganFX advertises the MetaTrader4 (MT4) trading platform as a Desktop and Mobile (iOS and Android) applications, which we should consider an advantage since the MT4 is among the foremost trading terminals in Forex trading – nearly 80% of users worldwide prefer it. The platform provides an advanced charting package, lots of technical indicators, extensive back-testing environment and a variety of Expert Advisors (EAs).

The software shows quite advantageous spread for the EURUSD currency pair of 0.5 pips, but considering we could register for either Live or Demo account we cannot believe these quotes:


Furthermore, the quotes on their home page show a spread of 1.4 pips for the same pair.


This is only one of many inconsistencies, which pervade this broker’s website. And of course there is a misspelling in the word “Spread” here too.

 

MuganFX Trading Conditions

As we saw in the Account types screenshot above, MuganFX offers a maximum leverage of 1:500. High leverage is not something bad in itself – some regulated markets, such as Australia, do not put limits on it. It can be very risky, especially for inexperienced traders, however – leveraged trading allows for big profits, but may also cause significant losses, often much more than initially invested. That is why, US regulatory authorities impose a leverage cap of 1:50 for non-professional traders, while for brokers licensed in the EU and the UK it is 1:30.

The quotes on MuganFX’s homepage show a spread of 1.4 pips for EURUSD – not great not terrible.

MuganFX Deposit/Withdrawal Methods And Fees

Here the discrepancies continue – the first one sees on the Home page is that the Minimum Amount to Start (open an account) is $100. In the FAQ section, however, it states the minimum amount required for opening a real account is: “For individuals – $300, for legal entities – $1,000.” With regards to payment methods or fees charged, the broker is quite vague, but there is the statement that if the clients deposits in currency other than US dollars, the amount will be converted into USD “at MuganFX rates for that day”. Of course, there is no information about these rates.

There are no any payment providers’ logos or statements on the website. Since we could complete any registration with this broker we could not explore its client area to see if there are any details there.

The User Agreement is also quite elusive and unclear. It has many general statements and terminology, but there is nothing concrete. For withdrawals what we learn is that one must submit to Mugan FX LTD an Application for withdrawal of funds and this is it. Whether there is any fees or surcharges, and how long it will take to process this application is not specified.

Considering everything above, the inconsistencies, the lack of regulation by an established licensing authority, and the absence of basic functionalities such as registration, or information about financial conditions, we would not advise our readers to have any dealing with this broker.

How does the scam work?

This section is dedicated to showing how the most common scams work. Usually they are pretty simple and straightforward. Through internet ads promising quick and easy profits from forex trading potential traders are induced to enter their personal information, such as email and phone number. Once the users input this information, they will start receiving unsolicited calls from illegitimate broker representative whose job is to persuade them to make the first deposit of about 300 USD, from which they make a fat commission. When this is done, the traders are transferred to senior scammers who are very good talkers and will start working on them to deposit even more money. At this time, if not earlier, most people will start suspecting some fraudulent activity and will want to withdraw their funds.

This however often proves impossible to do as the scammers put all their resources into convincing them that now is not the right time or that such action will lose them a lot of money in “potential profits”. If the users persist, these con-artists will find a number of excuses, usually hidden in the clauses of the accepted agreements, to delay withdrawal requests for as long as possible. The end purpose is to miss the limited time period for filing a chargeback with their bank and thus lose any chance of getting their money back.

What to do when scammed?

If you have deposited with VISA or MasterCard there is still a chance to get you money back since recently both companies extended their chargeback period to 540 days, especially when an online scam is involved.

Scammers will not stop at stealing directly from your bank account if you have provided sufficient details, so if this is the case be sure to change your password or security code right away.

Also beware of being scammed again by so-called “recovery agents”. They will ask you to pay a fee to recover your losses, but after paying them you will never hear from them again.

Rich Snippet Data
Review Date
Reviewed Broker
MuganFX
Broker Rating
11stargraygraygraygray

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