Beware! LegalTrader.com 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.
You very well know that if you come across a broker called LegalTrader.com it will be anything but legitimate. Even though the company has an attractive website, we still were skeptical. The interface is decent enough, and there is a good source of information, but we cannot overlook the preliminary impression the namesake of the website left on us. We have quite a few things to reveal about this broker, so we wont keep you waiting. Just note that LegalTrader.com is not what it seems to be.
In order to register an account, we had to complete a very simple process, that took us less than 20 seconds to fill and submit. After we registered, it was as if though nothing had happened. There was no real client area, but only a new bar that gave us the basic options of withdrawing, deposits, changing personal details, and accessing a web trader.
The EUR/USD cost of trade is at 3 pips, which is unacceptable and in no way lucrative to users. The available trading assets are forex currency pairs, cryptocurrencies, stocks, commodities, and indices. The leverage can go as high as 1:400.
The website of the firm is available in English only.
LEGALTRADER.COM REGULATION AND SAFETY OF FUNDS
The parent company of the broker is called Central Finance Outsource Limited, which is located in the Commonwealth of Dominica.
The Commonwealth of Dominica is not a jurisdiction easily associated with unregulated brokers. Mainly because the country does not have a forex and CFD broker regulator, even though it does have a banking sector and non-banking institutions overseer. And so, LegalTrader.com might be registered as a company there. but it certainly is not licensed as an FX broker, which is by far the most important aspect of any broker.
Aside from this information, there is nothing else to work with. The broker seems to be keen on the Commonwealth of Dominica address. Becaseu of this, we have no choice but to deem this broker UNREGULATED, and therefore a risk to all investments!
We always say that investing in unregulated brokers is a sure way to lose money. The first and foremost thing to do when picking a broker to invest in is to look for a license. Preferably look for FCA or CySEC regulated brokers, or other European watchdogs, or US ones. All legit regulators have long lists of rules and prerequisites that all brokers must abide by. Not doing so, will lead to penalties or foreclosure! Furthermore, many regulators have in-store financial compensation schemes for all users under licensed brokerages. For example, CySEC guarantees up to €20 000 per person, while the FCA guarantees up to £85 000.
LEGALTRADER.COM TRADING SOFTWARE
By far the biggest issue we had with the web trader is the TradingView chart on what it overall a decent terminal.
The TradingView charts do not corelate with the trading conditions offered by the broker. Including a third-party chart is the mark of the scammer broker! The main features of the web trader are time frames, price alerts, stop-loss, take-profit, social trading, one click trading, and chart customization tools although these belong to the TradingView charts.
LEGALTRADER.COM DEPOSIT/WITHDRAW METHODS AND FEES
In the user area, we learn that deposits cannot happen in our region. The broker explicitly claims that no payment methods are available to us in our current jurisdiction. Yet, the broker did let us to create an account. This is a common move by scammer brokers: they do not consider us as potential investors and thus block us. The minimum deposit according to the website is $2500 for the most baisc of all accounts! This is a joke.
The withdrawal section reveals that the minimum amount to take out is €1. But it also reveals that there might be fees. What we just revealed was al form the user area.
Now follows the info we got form the website. The alleged payment methods are Credit/Debit Cards, BPay, wire transfer, E-Money, and a bitcoin wallet. Withdrawals are processed in 3 to 4 days. The first withdrawal is free of charge. After that there is a 3.5% commission. If the charge is equal or less than $30, traders will be charged $30.
LegalTrader.com isn’t really worth it. As a matter of fact, it not worth it at all! Your money and personals details are at a risk!
How does the scam work?
Online ads are the gateway to most investment scams. Ads that seem extravagant with quite impossible promises are most certainly the entry point into a scam. Gibing into one of these ads is the first step to being scammed.
The second step is to deposit. Once users click on the ad, they will be redirected to a scammer broker site or an intermediary website. What follows is a registration, where users will be asked to provide a phone number or a phone number.
Next, the scammer will directly contact those that have fallen for it. The first calls are made by the first level of fraudsters, the rookies. Their one and only goal is to compel users to deposit for the first time. Once a deposit is made, the user is hooked onto the scam.
The second wave of scammers, the core of the fraud, sometimes called “account managers”, will try to keep you invested in the shame for as long as possible. They might even pay some profits, just to keep you invested. The user will deposit an additional 2-3 times, which is actually the perfect scenario for these criminals. At some point, the user will realize he or she is in the middle of a scam
There are no more steps to the scam. The user has deposited as much as he or she did, and the fraudster have disappeared. The money is gone, and users cannot withdraw.
What to do if scammed?
If money was lost through a credit or debit card, the good news is that most credit card companies have an easy way of recovering money. Furthermore, MasterCard and VISA have a chargeback period of 540 days.
Wire transfer frauds, that is broker/investment scams, are harder to recuperate, but not impossible. The crucial thing to do is to change your bank account username and password! Aside from that, we advise users to contact their banks, because most banking institutions might have a plan on how to deal with money lost to investment scams!
Never invest in unregulated brokers through any sort of cryptocurrency wallet, no matter how good the returns sound! Crypto deposits are untraceable!
The last scam that users might stumble upon is in fact most of the time one that has nothing to do with the investment scam, although a potential relationship between the two is not excluded. We are talking about the so-called recovery agents or agencies. These will claim to be able to recover lost funds in return for a fee. After users pay this charge, they can kiss their money goodbye!