Beware! IFDC Capital 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.
IFDC Capital is advertising trading in Forex, commodities and cryptocurrencies. From the very beginning their website makes a bad impression, despite some spectacular images you see when you first open it. There is poor English, bad design, missing images on some pages and a mix of English and Chinese although the entire website should be translatable.
This broker does not offer different account types. Actually opening an account with them proved impossible since it required an “Introducing Broker number” which we did not have. The registration form was also full of spelling mistakes – although we cannot be sure about the Chinese, such sloppiness should be enough to convince anyone to stay away in our opinion.
IFDC Capital Regulation and safety of funds
The broker claims to be authorized and supervised by the National Futures Association (NFA) of the United States. Although the license number posted checks out – it is of an approved NFA member, IFDC Capital Management LLC, registered with the Commodity Futures Trading Commission (CFTC) as a Commodity Pool Operator – there are some inconsistencies, which raise a red flag and suggest this website might be a clone of a legitimate entity.
First of all, the address registered with the NFA is different from the one on the website. The phone number listed with the watchdog agency matches the address – it is with a California area code, whereas the one on the website has a Hong Kong prefix. Last but not least, the email address on the website is under a different domain which we checked out and it turned out to be an identical clone of the broker’s website.
It is clear that the brokerage targets Chinese investors, so we decided to check their statement regarding “strict supervision by local regulators in the operating countries.” As expected, we found a recently posted alert by the Hong Kong Securities and Future Commission (SFC) that IFDC Capital is an unlicensed entity, and “If you deal with a company which is not licensed by the SFC, you may not be protected by the regulatory framework enforced by the SFC.”
The Client Agreement, which was available for download from the registration page, was the next red flag. It bears the name of a legitimate, at least at first glance (as it is not the subject of this review we have not checked it thoroughly), broker – Union Standard International Group Pty Ltd, and is a nearly 100% identical copy of this company’s Terms and Conditions. Such sloppiness and / or arrogance is hard to believe.
IFDC Capital’s website is full of slogans about “financial security” and “fair trade”. They claim to partner with some of the world’s largest banks, such as Barclays, Citibank and HSBC, which provide “bank liquidity”. There is no evidence about any of that, however, so we advise our readers not to take these statements at face value, and will even warn them that their money will not be safe with this broker.
Legitimate brokers, regulated by austere watchdog agencies, such as UK’s Financial Conduct Authority (FCA) and the Cyprus Securities and Exchange Commission (CySEC), have to abide by strict rules. Among these are Client Account Segregation (clients’ money is kept separate from the broker’s operating funds), Negative Balance Protection, which ensures that one may not lose more than the initially invested funds and Compensation Schemes providing additional guarantee to clients’ funds up to a certain amount (85,000 GBP in the UK and 20,000 EUR in the EU).
IFDC Capital Trading Software
IFDC Capital offers the MetaTrader 4 (MT4) trading platform on their website as desktop and mobile (iOS and Android) applications. MT4 is the world’s leading platform, preferred by more than 80% of users. It features an intuitive, user-friendly interface, advanced charting and analysis tools, as well as copy- and auto-trading options. It is customizable using the proprietary MQL4 programming language, with which one can create different trading strategies.
IFDC Capital Trading Conditions
There is no information about spreads on the website, apart from the fact that they are “dynamic”. With an MT4 demo account we see a 2 pips spread for the EURUSD currency pair, which quite big. With regulated brokers, this most traded currency pair rarely comes with spreads larger than 1 to 1.5 pips, as this would only guarantee hefty profits for the broker while making no returns for the traders.
Also, in the demo account we could select a leverage of up to 1:500. Such high leverage provides huge profit potential, but it also presents great risks to the traders because any losses incurred will be multiplied. That is why regulatory authorities in Europe and the US impose a leverage cap for retail brokers of 1:30 and 1:50, respectively, and it is another sign that IFDC Capital cannot be licensed by the NFA.
IFDC Capital Deposit/Withdrawal Methods And Fees
As we are not able to register with this broker, we cannot investigate their payment methods fully. The website does not say anything about credit / debit cards or bank / wire transfers. Popular methods, such as PayPal and other preferred by traders e-wallets, eg. Skrill and Neteller, are also not mentioned. The client agreement indicates that standard deposit methods should be available, but as we saw it is a copy – paste document that cannot be trusted.
Regarding minimum deposit or withdrawal amounts there is no information either. We have no idea what fees the broker may charge for any financial transactions or what the processing time for these may be. There is a vague statement that “the related fees, charges, interest rates and balance requirements, may vary according to the location of the region.”
Considering everything outlined above – the suspicious regulatory status of the broker, the lack of important financial information and the overall sloppiness of the website – we believe IFDC Capital to be an unlicensed, clone broker and would not advise investing with them.
How does the scam work?
Users often fall prey of very simple but quite efficient scams. The first snare is usually an internet ad promising big profits over a short period of time, and all you need to do is provide your personal information, usually email address and phone number. If you do that, you will start getting calls from scam brokers who will continue with the pitches of quick and easy profits until you decide to make a first deposit of $200 to $300. On these funds the scammers get a fat commission and transfer you to senior “brokers”.
These expert con-artists are smooth talkers who start talking you into putting even more money in, because “now is the perfect moment” or “the more money you invest, the higher your profits will be”. Usually about this time most traders will start to feel the scam and will want to withdrawal their money and get out fast.
Unfortunately, the scammers will not give in easily. First, they will try to persuade you not to withdraw right now because you will miss on “big profits”, and if that does not work, they will find numerous reasons to deny or delay your request by asking you for additional documents or claiming that there are some other causes for not executing the withdrawal. The ultimate objective in such procrastination is to make the traders miss the crucial period in which a chargeback request can be filed, and thus lose the chance of getting their money back.
What to do if scammed?
If you used a credit card to make a deposit with the scammers you should immediately file for a chargeback. Both VISA and MasterCard have increased the time in which you can file to 540 days, in part specifically to fight such online scams.
If you used bitcoin or some other untraceable source, however, chances of recovering your funds are slim. You might get approached by so-called “recovery agents”, but don’t fall for their tricks. They will ask for payment up-front to recover your money, but this is just another scam and you will not get anything back.