RECOMMENDED FOREX BROKERS
Don’t put all your eggs in one basket. Open trading accounts with at least two brokers.
In this review, we are going to focus on a regulated offshore broker operated by a company holding Belize and Cyprus licenses. However, SM-Invest is regulated in Belize only, so they can offer increased leverage, which is an attractive opportunity for many traders indeed. The broker allegedly does not accept EU traders, but this statement is not actually correct. Find out what we are talking about in the full SM-Invest review.
SM-Invest REGULATION AND SAFETY OF FUNDS
SM-Invest is a brand name of Scope Markets Ltd, a company holding an IFSC license in Belize. We could verify their license, so on paper, your funds should be safe if you deposit with the broker. However, the Belize regulation is not as extensive as it should be, and the significant customer protection is still seen lagging. The only important measures we can mention are the capital adequacy requirement of $500 000 and the clients account segregation, both of which showing that Belize has put some effort, but it’s not enough.
That said, we can offer the high-rated EU brokers and British brokers, which are trustworthy and stringently regulated. The European companies are secured by deposit insurance funds, laid down to protect clients’ money in case of insolvency or fraud, and that’s why we highly recommend those. For example, if you trade with a CySEC broker, you can claim up to 20 000 EUR in compensation, while the British protections are of even up to 85 000 GBP per person. The Belize license may be worthy, but traders’ funds are not even partially guaranteed, so traders may lose some or all of the capital invested in case things go wrong.
In fact, Scope Markets Ltd. holds a CySEC license, too, but SM-Invest is not enlisted as a Cyprus and EU regulated broker. Probably due to this fact, we observed some worrying inconsistencies, which should reasonably be marked with red flags. We are going to discuss those features in the following paragraphs.
SM-Invest TRADING SOFTWARE
According to the website, SM-Invest provides with MetaTrader4 only, and we could indeed download it and run it. However, as we are Europeans, they didn’t grant us access to the platform, and it was impossible to open neither Demo nor Real trading accounts. That’s the right thing they should do, actually, but it’s not the end of the story.
Upon registration, another web-based platform is accessible directly through the browser, which is fully functional even for restricted European customers like ourselves. The platform is certainly not as good as the MT4 distribution and can’t offer significant advantages. Worse, though, we could even straight away deposit funds, bypassing the KYC and AML procedures the broker is bound to comply with. That’s a notable red flag undermining the SM-Invest’s credibility. We advise traders to stay cautious if dealing with the broker.
Instead, you’d better consider the MetaTrader4 brokers and MetaTrader5 brokers topping both lists. The MT platforms feature advanced tools such as Expert Advisors, complex indicators, and first-class charting tools, which are also very easy to use. MetaTrader also comes with a Marketplace where traders and investors can find more than 10 000 apps and third-party developed solutions.
The EUR/USD spread on the web-based platform was 1.7 pips at the time, a tolerable Buy/Sell difference, but not the best one on the market. The spread forms some of the trading costs, so the lower ones benefit traders and generally improve profit potential. Most of the regulated brokers offer spreads of 1 pip and below, so it’s not challenging to find better opportunities.
SM-Invest offers three leverage levels only– 1:100, 1:200 and 1:500, all of which too risky for retail traders. That’s a significant downside because traders are not allowed to adjust to less risky ratios such as 1:10 or 1:30, for example. It turns out that SM-Invest intentionally push traders into a high-risk environment, and we need to record this as another red flag. Beware!
In fact, leverage is so dangerous that many financial authorities imposed a market cap restricting its usage on the respective markets. Consequently, EU, British and Australian brokers are bound to limit clients to 1:30 for FX majors, while the Canadian brokers and the US brokers can’t provide more than 1:50. Most of the high-leverage FX companies are poorly regulated and very likely a scam, so be cautious.
SM-Invest DEPOSIT/WITHDRAW METHODS AND FEES
The minimum deposit with SM-Invest is $100, a demand that generally meets the industry standards. The funding methods we encountered were Skrill, Neteller and Wire Transfers, and surprisingly they do not accept Credit/Debit cards. Bank card funding is seen as safer due to the chargeback rights guaranteed by Visa, MasterCard and other issuers, meaning that traders can get some or all of their money back within an extended period- up to 540 days depending on the case.
While discussing deposits, we can offer the Skrill brokers, Neteller brokers, FasaPay brokers, Sofort brokers, and Bitcoin brokers if you have trusted payment systems. The companies topping the lists are adequately regulated, and you won’t face scammers if you choose a high-rated company.
The minimum withdrawal is $50, which we find an unfair requirement because there are too many brokers not imposing any restrictions at all. Also, the broker states that one withdrawal per day and up to 5 per week are free of charge, while the rest will be subject to a $35 fee per transaction. The request processing time is 1-2 days, but it might extend to 5 days, depending on the method.
As for inactivity fees, SM-Invest doesn’t specify anything, which probably means they do not charge inactive account. Still, they could have at least mentioned it because the inactivity procedures are important for traders, especially those having accounts opened with multiple brokers.
Overall, SM-Invest is a Belize regulated broker but can’t guarantee substantial customer protection. We believe you’d better stay away from this entity, notwithstanding the license it has.
HOW DOES THE SCAM WORK
Scammers are working online today. Social media and the Internet, in general, is plagued by scammers and their fraudulent offers. If you fancied an opportunity, clicked on and submitted your e-mail and contact numbers, scammers would ring you at once. They are seasoned manipulators who would promise the moon and the stars to lure people into their crooked schemes. During the phone call, you’d be offered bonuses, promotions, risk-free offers, bitcoin deals, and anything else you could possibly imagine. Scammers would claim to work with reputable firms, banks, governments, and so on while pushing you to invest with them. Those thieves lie big time and would promise you anything to gain your confidence and steal your money thereafter.
But the first deposit is just the beginning. Steadily scammers would carry on asking for more money from you no matter what. If you lost on the market, they’d persuade you to put more money and recover the losses. If you traded well, they’d convince you to put more money and increase the profits. The troubles start when you ask for a withdrawal. The scammers would do whatever it takes to discourage you and would even ask you to deposit even more funds if you want to withdraw. The scammers’ mantra is “give me your money”, they’d push you to transfer more money over and over again for no obvious reason. Urgency is a treacherous sign, so if someone forces you to invest ASAP, that’s a scam.
WHAT TO DO WHEN SCAMMED
Unfortunately, no one is safe from scams. If you get defrauded, the first thing you need to do is to protect yourself from further risk. Deactivate your card immediately, contact your bank and ask for advice.
Report what happened to you, file a complaint, contact the financial regulator, contact other government institutions related to trading and investing, call the police if you feel necessary. Seek help actively!
Remember, it’s crucial not to rush blindly trying to recover your funds because fraudulent chargeback and fund recovery agencies are trying to double scam the victims. They ask for upfront payment, take the money but won’t do anything to help you!
Last but not least, share online your experience; it’s important to inform the public about scams. Be responsible!