Beware! Fannexx 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.
Fannexx presents itself as an STP broker founded by a ”group of professional traders, investment managers and software engineers”, who offer “fair trading conditions”. However, the reality is that this is an extremely dubious offshore company that is not subject to regulation and offers misleading and disadvantageous terms to its clients.
FANNEXX REGULATION AND SAFETY OF FUNDS
The company behind Fannexx, Trinity Capital LLC, is registered in the Saint Vincent and the Grenadines (SVG). The website makes a rather brazen attempt to convince that this offshore zone is actually located in England:
Such attempts at deception are in themselves indicative enough that this is not a company you want to trust with your money. Apart from that, Saint Vincent and the Grenadines is notorious as a favorite location for scammers posing as brokers. While this country has a financial regulator, unlike other offshore areas, it does not regulate the activities of forex and CFD brokers.
Тhe Financial Services Authority (FSA) of St. Vincent and the Grenadines has repeatedly issued warnings on this issue, with the latest such warning dated 23 June 2021. It clearly states that the agency “does not issue any licenses to carry on the business of FOREX Trading or Brokerage or Binary Options Trading nor does the FSA “Regulate, Monitor, Supervise or License” International Business Companies which engage in such activities”.
If you want to trade under truly fair conditions and without being scammed, you can turn to some of the legitimate brokers that actually operate from established financial hubs like the UK. These brokers have to meet stringent requirements for financial stability and transparency of operations imposed by the Financial Conduct Authority (FCA). They must provide clients with negative balance protection and to participate in a guarantee fund that covers up to GBP 85,000 of a client’s investment should the broker go into insolvency. These brokers are also required to keep their clients’ money segregated from their own operating funds in separate bank accounts.
FANNEXX TRADING SOFTWARE
Fannexx actually offers one of the most popular trading platforms in the industry, MetaTrader 4 (MT4). There are desktop, mobile and browser-based versions of the software available. Here is what the platform looks like:
This software is the most widely used in the industry for a reason. The platform offers many benefits such as multiple account usage, extensive interface customization options, and the ability to design and implement scripts for automated trading and back-testing of trading strategies. However, it is highly recommended that you take advantage of these options through one of the many regulated brokers that offer MT4 and the newer MT5.
FANNEXX TRADING CONDITIONS
Fannexx offers a free Demo account and three types of live accounts – Silver, Gold and Diamond. The minimum deposits listed are USD 1,000, USD 10,000 and USD 30,000 respectively, but the FAQ section states that the minimum deposit to open an account is USD 100. With the same USD 100 you can open a Micro account with most regulated brokers, which is the recommended option.
No leverage is specified in the account description, but a level between 1:100 and 1:500 can be selected when registering an account. The 1:500 level is also listed in the FAQ section:
While Fannexx describes high leverage as a positive thing, it is no coincidence that such high levels are not allowed for regulated brokers. Increased profit opportunity goes with equally increased risk. UK and EU regulators limit leverage for retail traders to 1:30 for major currency pairs and even lower levels for more volatile assets.
Fannexx’s website promises a low spread, but the MT4 platform shows otherwise. The spread level for a demo account there is 2 pips and 3 pips for a live account. In the industry, levels above 2 pips are considered high and are disadvantageous to the trader.
Fannexx offers bonuses to customers. This is also something that regulated brokers are not allowed to do.
There is a major catch associated with these generously offered bonuses. Once a client has received a bonus, withdrawing funds from their account becomes tied to prohibitively high minimum trading volume requirements. For every USD 10 bonus, the customer must trade a volume of 1 lot, i.e. 100,000 currency units. Given the high spread of 3 pips, this means that the trader will have to give Fannexx USD 30 for every USD 10 of his supposed profit.
FANNEXX DEPOSIT/WITHDRAW METHODS AND FEES
On its website Fannexx states that it accepts “a wide variety of payment options”, including Visa, MasterCard and wire transfers. However, only two unknown and very questionable online payment platforms are available in the deposit menu, PayBnB and AnPay. Scammers prefer such shady platforms because using them makes it difficult for the customer to get a refund.
Legitimate brokers offer a wide range of payment method options, including card and bank transfers, as well as established online platforms such as PayPal, Skrill or Neteller.
HOW DOES THE SCAM WORK
The online space is full of ads promising easy money. They sound too good to be true, because they are not – they are outright scams. Many of these fraudsters pose as brokers and take advantage of the general public’s ignorance of the capital markets.
If you give your contact details to one of the flashy sites promising to make you rich, you will be contacted by experienced scammers who will start convincing you to “invest” in their scheme. Initially they will ask for a small amount, say USD 250 or USD 500. If you agree, they will begin to persuade you to give them larger sums.
However, your money will never be truly invested in the market, and you will not be able to receive either the supposed profits or the money from your deposit. Your attempts to withdraw your money will be blocked by deliberately confusing clauses in the terms and conditions. Some of the most commonly used traps are extremely high minimum trading volume requirements or withdrawal fees equal to 10%, 20% or more of your funds.
WHAT TO DO WHEN SCAMMED
It is very important not to rush into trusting people on the internet who offer to magically refund your money for a fee. These are also scammers, and they may even be the same ones who scammed you in the first place.
If you have made the transfers using credit or debit card, you can claim a chargeback. Visa and MasterCard allow this to be done within 540 days. However, such a request may not be approved if you have given the fraudsters documents such as a copy of an ID and proof of address. This will allow them to claim that the transaction is legitimate and approved by both parties. Wire and cryptocurrency transfers unfortunately are not refundable