Beware! DoitFX is an offshore broker! Your investment may be at risk.
RECOMMENDED FOREX BROKERS
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The first thing we notice upon opening this broker’s website is that it does not provide a secure connection. As your browser will tell you if you click on the “Not secure” notice in the URL bar, you should not enter any sensitive information on this site, because it could be stolen by attackers.
Although we do not advise submitting personal information on a not secure site, we decided to explore further – the registration form asks for first and last names, email address, phone number and country. At providing those we were redirected to the client area and received an email with the account credentials in plain sight – not a good practice in terms of security and privacy since email communications can be intercepted.
DoitFX is an offshore broker advertising trading in Forex, Stocks, Indices and Commodities. They have two types of accounts – Standard and VIP – but they are not detailed on the website. It is only after you register and access the client area that you can select one, but again there are no specifics as to the differences between them. There is no Demo account, which is another red flag, since every respectable broker offers one.
DoitFX Regulation and Safety of funds
The broker has a London, UK and a Saint Vincent and the Grenadines (SVG) office addresses, but no phone number listed on their website. In their Terms and Conditions they state that “the company is authorized and regulated by Financial Services Authority (FSA) de Seychelles”. Both SVG and Seychelles are offshore jurisdictions, but compared to SVG the requirements for Forex Broker License in Seychelles are a little tougher – there are capital requirements of $50,000 plus 2 local directors and a physical office are mandatory. The time to receive the license ranges from 4 to 6 months, as opposed to 2-3 weeks in SVG.
So we made the effort to check on the Seychelles FSA’s website – there is no DoitFX Securities Dealer listed there. No surprise here, since if they had a license they would put their license number and / or scanned copy of the certificate on their website – that is what regulated brokers do. To be thorough we also checked the UK’s Financial Conduct Authority (FCA) database for the broker’s name – no result there too.
DoitFX may claim their client’s money is safe because they work with top-tier banks and put the logos of some of the largest international banks, but in the absence of any regulation this should not be taken at face value.
Generally we advise traders to avoid offshore companies and to invest with brokers regulated by reliable authorities such as the FCA in the UK or the Cyprus Securities and Exchange Commission (CySEC). These watchdog agencies impose strict rules on the brokers they license – Client Account Segregation requires that clients’ funds are kept separate from the broker’s operating funds. while Negative Balance Protection ensures that traders cannot lose more money than what they invested. Other policies include a Minimum Capital Requirement of 730,000 EUR in order to guarantee the broker’s good financial standing and participation in Compensation Schemes, which provide additional assurance for investors’ funds up to a certain amount (85,000 GBP in the UK and 20,000 EUR in the EU).
DoitFX, however, is an unregulated, offshore broker and they are not bound by the rules and policies imposed by recognized regulatory bodies. We advise our readers not to invest with them as there is no guarantee for the safety of their funds.
DoitFX Trading Software
The trading platform the broker offers, Xone Trader, is unknown to us. In the client area they have links for Desktop, Web, Android and iOS versions, but it turned out there is no Web version – the Webtrader link is the same as the Android one.
In contrast, respectable brokers offer established trading software to their clients. The MetaTrader 4 (MT4) and MetaTrader 5 (MT5) trading platforms are available as Desktop, Web and Mobile (Android and iOS) applications.
MT4 is the world’s number one platform, preferred by more than 80% of users worldwide. It offers an intuitive and user-friendly interface, advanced charting and analysis tools, as well as copy and auto-trade options. It can be further customized to create different trading strategies using its proprietary MQL4 programming language. Its successor, MT5, has some advantages – it allows traders to execute trades on different financial markets through a single account and there is a hedging option.
DoitFX Trading Conditions
As we saw in the screenshot above, DoitFX claims they are a Straight through Processing (STP) broker, which would mean there is no conflict of interest between them and their clients because orders are sent automatically directly from the trader to the liquidity provider without passing through a dealing desk. Unlike market makers, which profit from the Buy/Sell difference (spread) they offer to the traders, STP brokers usually advance lower spreads, but charge commission on transactions.
DoitFX advertises spreads as low as 1.2 pips on their website. The platform screenshot above shows no spread for EURUSD, which is too good to believe. Regulated brokers usually provide spreads between 1 and 1.5 pips for major currency pairs.
The broker offers leverage of up to 1:500. Offshore brokers enjoy no restrictions on leverage, but leveraged trading entails significant risks, especially to inexperienced traders. High leverage provides huge profit potential, but also presents great risks to the traders because any losses incurred will be multiplied. That is why, most regulatory authorities impose leverage caps for non-professional traders: in the USA it is 1:50, while for brokers licensed in the EU and the UK it is 1:30. The Australian Securities and Investments Commission (ASIC) will also restrict leverage for major currency pairs to 1:30 from March this year.
DoitFX Deposit/Withdrawal Methods And Fees
We cannot learn much about the financial transaction conditions the broker offers from their website. There is no information about the deposit and withdrawal methods available or any minimum requirements. There is a statement in their T&Cs that in the case of debit or credit card deposits they will request a scanned copy of the card showing the first 6 and the last 4 digits of the card number, but in the client area the only available option for deposit is Bitcoin, for which they say the processing time would be instant and the fee $0.
Bitcoin is a preferred method by scam brokerages because it is completely untraceable and anonymous – one should always be on their guard if this is the only payment option available. Respectable brokers generally provide a number of deposit and withdrawal methods, including wire / bank transfers, credit / debit cards, PayPal and e-wallets, such as Skrill and Neteller.
In conclusion, we want to note that although the trading conditions presented on the website are attractive, they cannot be verified, since even basic functionalities are not working on the broker’s website. DoitFX is not a regulated broker and investing money with them is a huge risk!
How does the scam work?
Users often fall prey to 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 withdraw 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 when 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.