Beware! XMBFX 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.
This broker with the unpronounceable name XMBFX offers an easy to navigate interface and the information provided there is mostly visible and easy to navigate. However, the question is, how reliable this broker is and can you entrust your funds to it?
XMBFX Regulation and safety of funds
We find that the address of this broker is in the UK, so we checked the register of the Financial Conduct Authority, the official body that regulates forex brokers in the UK. We found out that XMBFX is not registered, therefor this broker is not licensed and as such is not reliable to trade with. Do not entrust your funds and stay away from it!
There are a lot of licensed forex brokers in the UK if you wish to trade with one. To be licensed in the UK, brokers must have an initial capital of no less than 730,000 EUR. This, among other things, serves as a barrier against scammers as they won’t such a big amount of money just to look legit. There are other measures to prevent scammers from sneaking in and that serve to protect clients’ funds. For example, clients’ funds must be kept separately with reputable banks, brokers must report their transactions on a regular basis for the sake of transparency and there is also protection of clients’ funds against negative balance. One of the big benefits, though, is that licensed brokers must deduct funds towards the local Financial Services Compensation Scheme from which, in case of insolvency, clients can be reimbursed by up to 85,000 GBP per person.
In the EU, there are similar trading conditions with the difference that if the broker is regulated by CySec and contributes to the local Investor Compensation Fund, its clients can be repaid up to 20,000 EUR per person if the broker goes bankrupt.
We hope that the links we provided above will be useful in selecting the best forex broker for you.
XMBFX Trading software
To its clients, XMBFX offers one of the best trading platforms in the forex trade world, namely MetaTrader 5. This platform is equipped with an amazing package of trading tools and instruments that include an auto trading option, code base with customs scripts, an app market, VPS, trading signals, a financial calendar, etc. The platform also posses the same great charting options that we are used to finding in MetaTrader 4. Clients can choose among different chart types, time frames, colours or even create personalised templates. MT5 offers a great choice of technical analysis indicators, such as Bollinger Bands, moving averages, Fibonacci retracement to mention but a few that help traders predict the future direction of exchange rates and make a profit.
If we take a look at the screenshot below, we will see that on the left of the screen is the menu with trading products which in this case show the major forex pairs with their bid/ask price. Beneath is the navigator that opens the accounts, indicators, expert advisors, scripts and services. In the middle, you see displayed the charts of 4 currency pairs with the fluctuation in their price in a given time frame. As we mentioned already, the number of charts may vary from one to many as per the trader’s needs. The top-left chart shows one of the major currency pairs, EUR/USD. From the bid/ask price of the same pair, we see that the spread is 3 pips. This spread is quite wide and is above the industry average of 1.5 pips. Wide spread signifies that the cost of transactions will be high and traders won’t be able to make a long-term sustainable profit. On the other hand, most brokers make a revenue from the spread, so what is the trader’s loss is the broker’s gain.
In addition to the wide spread, we were alarmed to see that the leverage, as shown in the account types information in the last screenshot, can reach up to 1:400. High leverage signifies only two things – a big profit or a big loss, depending on how successful the transactions are. But, keeping in mind that around 70% of traders experience financial loss in transactions, chances are that you become poorer, not richer if you use such leverage. Besides, you should keep in mind that licensed brokers in the UK and the EU cannot exceed leverage higher than 1:30 and this is another proof that this broker is not reliable!
XMBFX Deposit/Withdrawal methods and fees
Clients of XMBFX have a choice of 4 different trading accounts – Mini, Premium, ECN Pro and ECN Pro+Commision. The minimum initial deposit for the Mini account is $100. From the information on the company’s website, it seems that there a lot of payment options for making a deposit or withdrawal, such as credit card, bank wire, Neteller, Skrill, WebMoney, PerfectMoney and Bitcoin.
Both deposits and withdrawals are fee-free and the processing time is instant with the exception of bank wires and local transfers which can take one business day.
We must say that these conditions are not bad.
How does scam work?
A lot of people get scammed in different scammers’ schemes not because they are naive but because scammers are masters of persuasion and manipulation. It all starts with unsolicited telephone calls or a flashy ad on the Internet or social media. Sometimes people give up to temptation and invest money in shady schemes made to look legit and attractive and always promising quick and easy money fall. Once you deposit money into any of these schemes, you reach a point of no return! Your money is gone down the scammers’ food chain and you’ll have a lot of trouble recovering it. Scammers will do anything in their power to delay you, so you miss the opportunity to file for a chargeback. They will ask you for this and that document and will find hundreds of reasons not to let you retrieve your money. The trick with offering bonuses in forex trading is one of those as your funds are mixed with the bonus money and it takes a lot of hassle to fulfil the broker’s requirements before you are able to withdraw any funds.
What to do if scammed?
Speed does it! You need to act very quickly if you want to recover your money. Immediately apply for a chargeback if you have made your deposit via credit card. Fortunately, VISA and MasterCard give you 540 days within which to apply for a chargeback.
If you have paid via wire transfer or Bitcoin, chances of retrieving your fund are grim. Anyway, we want to warn you that some of the so-called recovery agents may approach you and offer to retrieve your funds. For a fee, of course! Be cautious when dealing with them as it may be another form of scam! Always check if the recovery agency is legitimate and visible to the public!
Another thing we advise you to do is to immediately cancel any credit cards if the scammers have your CVV code. Also, make sure to erase any programs on your computer that give scammers access to your personal data on your PC.
