Beware! StarCapital 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.
StarCapital focuses on an average delivery of visuals, that will certainly not make any of its audience member exclaim or otherwise. This mediocre visual element usually is surpassed by good and stable trading conditions that focus on retaining existing users while attracting new new ones. We feel that StarCapital is not such a broker, and in fact we feel, upon first or first impressions, that StarCapital hides something sinister. Furthermore, the broker’s legal document keep referring us to the website, most noticeably for spread charges, yet the website hold no such information. Read the review to find out more about this one.
It never a good sign for a broker when its registration process takes less than 10 seconds to fill. The process did not even require a password…The user dashboard is nothing to write about, and is rather underwhelming.
The web trading platform was generous with the spread which amounted to 1.4 pips, or the average cost of trade. The preliminary leverage is 1:30 according to the legal docs; the user can change it by contacting the broker. However, we were given a 1:400 leverage. As per the terminal,user can trade with forex pairs, commodities, crypto, stocks, and indices.
The website and client area can be translated in English and German.
STARCAPITAL REGULATION AND SAFETY OF FUNDS
The Terms and Conditions claim that the broker is located and operates in Dominica. The Commonwealth of Dominica is not the ideal location for a broker to work from, because, even though the country oversees the banking sector and some independent organisations, the Forex and CFD brokers are all left to self-regulate, which as you might have guessed is a recipe for a scam.
Keeping that in mind, StarCapital does not mention any other location, nor does it actually mention that it holds any sort of license. So, we have no choice but to deem this broker UNREGULATED, and therefore a risk to all investors!
Traders should be trading with risk-free brokers, that hold licensed from renowned and austere agencies, like the FCA or CySec , which have made a name for themselves as some of the top regulators. Readers should be aware that both agencies have adapted very strict rules of conduct, and their licensing framework guarantees safety and security for all clientele. A good example of this is the segregation of accounts which assures that client money and broker money are kept in separate accounts. Furthermore, FCA/CySEC brokers participate in a financial reimbursement scheme that cover traders losses in case the broker becomes insolvent. The FCA provides up to 85 000 pounds per person, while CySEC guarantees up to 20 000 euros.
STARCAPITAL TRADING SOFTWARE
The seemingly proprietary software for trading, a browser based one, is nothing like the alleged MT4 that keeps been advertised everywhere in StarCapital.
This platform is limited, and comes with a chart that is delivered from a third party provider, i.e TradingView, which put this software directly under the category of softwares used only by illicit brokers.
The only noteworthy thing here is that there are pending orders.
The Order Execution Policy mentions that CFDs and Forex will be charged a commission.However, we found no further information on this. So expect to be commissioned upon opening and closing trading positions.
Next is a very delicate sign that StarCapital is not licensed.
Usually users are given a couple of seconds in which they can cancel an order, but StarCapital gives them no such choice.
STARCAPITAL DEPOSIT/WITHDRAW METHODS AND FEES
The depositing area accessed only after registering revealed that the only depositing gateways are Credit/Debit cards and Bitcoin. The minimum deposit via cards is $200, while the BTC option was broken upon writing the review.
According to the Withdrawal Policy, the methods for withdrawing are crypto based, credit cards, and wire transfer. The minimum bank transfer withdraw is $250, for the other methods we don’t know as there is no information, and the company processes withdrawal request in about 10 days.
Throughout the main legal documents, there are many mentions of fees and taxes that occur. Most of these are common fees, yet some of these can be misinterpreted due to the ambiguous nature of the provisions themselves. Here is a very good exapmle:
There is even mention that for some payment methods fees may arise. This is a warning and an advice to you: do not risk it by depositing in StarCapital!
The company may refuse any service to a trader without giving any reason for it.
Overnight fees are tripled on Fridays to make up for the weekend, which is common offshore broker practice.
The inactive account fee is becomes applicable after 60 days of account dormancy. The one time fee is $200, but then there is a monthly fee of $20 or 5% if the available balance is more than $250.
The indemnification clause is why too long to include it in its entirety. Just note that the broker goes to great lengths to absolve itself from liabilities. Here is a small part of it:
However, this has not stopped StarCapital from acting as an illicit firm in other ways. For example, it can change the Client Agreement without telling the user. The same can be done to the Terms and Conditions.
As you can see, there are not many provisions that we encountered that are truly controversial. Some of or most recent reviews are of brokers whose attempts to scam you are evident in the legal docs; almost every subsection only the legal docs tries in some way to take more money from you. StarCapital has taken a more subtle route, but that does not mean in any way that this one is to be trusted. All hop we had for it is gone.
How does the scam work?
The usual scam operates on a multi-level, though very basic model. The users will be tempted to click on an Internet ad promising quick and easy profits. If they do, it will take them to a website that will ask for their personal details, including email address and phone number. Once they submit this information, an avalanche of emails and phone calls will be unleashed. Scammers will promise the world to these potential traders in order to induce them to make an initial deposit between $200 and $300.
These “brokers” will get a fat commission from the deposited sums and will transfer the unsuspecting users to “senior” scammers. The latter are smooth talkers who will try to persuade users to invest more funds, using phrases like “now is the right time” and “the moment is perfect for making hefty profits”. Of course, these are empty words, and traders will soon have doubts whether they have not been played.
When they try to withdraw their money, these doubts will be confirmed: the con-artists will do anything to deny or at least delay their withdrawals. From trying to convince the traders that they are making a big mistake to withdraw funds now because they will lose big profits, to asking for additional documents or citing clauses in the accepted agreements, to transferring you to another department, there is a single objective to delay the users from filing for a chargeback with their financial institution and lose any chances of recovering their money.
What to do when scammed?
Anyone can fall prey to such a scam. In the unfortunate event this happens to you, there are a few things you can do. If you deposited using a credit card you should immediately file for a chargeback. In an effort to combat online fraud VISA and MasterCard have extended the period in which one can file a chargeback to a year and a half, so there is a big chance that you may be able to recover your funds. If however, you used a bank wire or bitcoin to deposit, chances to get your money back are almost none.
We should also warn against “recovery agencies” who prey on victimized traders by claiming they can recover their funds. These scammers will ask you to pay a fee for this service, but will only take your money and do nothing.