RECOMMENDED FOREX BROKERS
Don’t put all your eggs in one basket. Open trading accounts with at least two brokers.
Veracity Markets is a brand new South African Forex broker, launched in 2020, owned and operated by Veracity Markets(Pty) which is a company that is said to be duly appointed juristic of Nirvesh Financial Services(Pty) Ltd. They claim that their mission is to empower people to trade with confidence by putting the customers first. Veracity Markets offers 250+ instruments, three types of accounts, competitive spreads, a range of automated trading platforms and segregated accounts where the client funds are held. Find out more about this spanking new Forex broker in the full Veracity Markets review.
Veracity Markets REGULATION AND SAFETY OF FUNDS
Veracity Markets is a South African Forex broker which is registered and licensed by the FSCA, the regulator supervising the financial activities in the country. Veracity Markets provides all of the details about its legitimacy on their web page, including registration numbers, license numbers, authentic headquarters address and contact number. However, there is a bit of a mess with their license on the FSCA database, and we do not know what the reason for this is.
Nirvesh Financial Services(Pty) is accordingly licensed to provide Derivative Instruments Products, as you can see in the picture below.
At the same time, Veracity Markets (Pty) LTD is still having a pending application in the FSCA database, as of 2018.
And yet, Veracity Markets can be found as an appointed representative of Nirvesh Financial Services (Pty) LTD, fully licensed to offer Forex products and services!
However, we can confirm that Veracity Markets are a legit Forex broker, no matter the South African administrative crunches. Your funds are safe if you deposit money with Veracity Markets, it’s a Forex broker that is registered, authorized and regulated by FSCA in South Africa. The African country regulates duly the retail Forex activities but actually lags in terms of customer protection policy. The higher leverage allowed certainly poses a threat to the traders funds and the Negative Balance Protection is still not mandatory to the FSCA regulated Forex brokers.
Our strong advice is to stick with the EU(CySEC) and UK(FCA) Forex brokers, as these intermediaries are the global leaders in the retail FX and CFDs market, and will treat your funds with an utmost care, not because they want to, but because they have to. Complying with the product intervention measures that the European Securities and Markets Authority has agreed, which further CySEC and FCA have implemented, the Forex brokers are required:
- to limit the leverage to between 1:30 (Forex majors) and 2:1(cryptocurrencies);
- to close out a customer position when the funds fall to 50% of the margin needed;
- to provide Negative Balance Protection on a per account basis, meaning that losses cannot exceed the total funds;
- to restrict or completely obliterate the incentives offered to trade Forex and CFDs;
- to provide a standardised risk warning to the customers.
Failure to do so will result in disciplinary action such as salty fines or license being suspended/revoked.
There are also money protection schemes in operation, such as ICF in Cyprus and FSCS in UK, which guarantee the deposits of the clients. Under CySEC(Cyprus) supervision you can claim up to 20 000 EUR in compensation, while in UK under FCA you are guaranteed of even up to 85 000 GBP. Each EU member state is compelled to create and further operate such a fund, which is regarded as a last resort for the traders, in case a Forex broker faces difficulties to meet its financial obligations.
Veracity Markets TRADING SOFTWARE
Veracity Markets offers MT4 to its clients, MT5 accounts are not available. Demo trading is possible and you can easily open an account when you download their MT4 distribution. Most of the time the EUR/USD spread in demo mode was floating between 1.6 to 2.2 pips during the London session, which is not too bad a difference, but a bit larger compared to its European competitors. The CySEC and FCA regulated Forex brokers will most of the time be able to offer EUR/USD spreads fewer than a pip, getting as low as 0.1 during the London and NY sessions.
The leverage offered by Veracity Markets is up to 1:500, as you can always adjust it upon your own preference. Such an increased level is too risky for your funds and you should avoid using such an insane ratio. 1:500 is no longer trading, but gambling.
There are three types of accounts offered by Veracity Markets- Standard, Fixed and ECN. The leverage is the same, no matter the account, but the ECN account is a bit different. The spreads are said to start from 0.00, which is actually a possible and very often seen a difference in an ECN environment. A commission of 7$ per lot is payable.
Veracity Markets DEPOSIT/WITHDRAW METHODS AND FEES
No minimum deposit is determined, but Veracity Markets recommends 250 USD to its clients, which doesn’t seem appropriate, making them look like a cheap broker with standards quite lowered! True Forex brokers will not dare to give advises on the deposit amounts made by their clients. No deposit fees applied by Veracity Markets, but bank charges might incur during the process.
The funding methods include deposit through First National Bank, ABSA Bank, Ozow Instant EFT, Skrill, Neteller and Bitcoin. Direct payment transfer is not available.
No minimum withdrawal specified, also no withdrawal fees are charged by Veracity Markets. An account becomes dormant after 3 months of inactivity and is subject to 50 USD fee each quarter of the year.
No bonuses available at the moment. There are three partnership programs presented- Introducing Broker(IB), Multi Account Manager(MAM) and a White Label program.
HOW DOES THE SCAM WORK
A group of scammers usually operates many different scam brokers, scam websites and call centers. Sometimes they will simply rely on the quantity, they will publish tens or hundreds of websites and will just wait for traders and investors with little or no experience to bite. Nowadays, it’s very cheap to create one, and it looks like a profitable strategy, as they carry on doing it.
Fraudsters are working in the social media nowadays, more and more scammers will first introduce their “services” to the people through Facebook or Instagram. You will click on a page, they will contact you, probably offer you a demo account and after some time you will be tempted to invest and make guaranteed profits. Once you are signed-up they will ask you to deposit money and this is just the beginning. The end is always the same, a robbed-off investor who lost his hard-earned money.
WHAT TO DO WHEN SCAMMED
No one is immune to scam, anyone can fall into the trap. Scammers are constantly looking for new and different ways to scam consumers. What you need to do first, in case you got scammed, is to protect yourself from further risks. Contact your bank and explain to them your situation, they will give you important instructions to follow and will help you, if possible, recover your money.
Report what happened to you, file a complaint, contact the financial regulator, contact other government institutions related to trading and investing. Seek help actively!
Share online your experience, it is important to protect others, as well. Be responsible!