Beware! Silwana Brokerage 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.
Silwana Brokerage is an offshore broker, apparently focused on the Arab world. In addition to the fact that it is not regulated, the Silwana Brokerage does not provide clear information about trading conditions, and some of the information on the website does not correspond to the reality. While we can’t judge for sure whether Silwana Brokerage are scammers, the warning signs are enough to recommend looking for a more trustworthy broker.
SILWANA BROKERAGE REGULATION AND SAFETY OF FUNDS
Silwana Brokerage provides a contact address in the United Arab Emirates and the website is available in English and Arabic. But the company that runs the Silwana Brokerage is based in Saint Vincent and the Grenadines (SVG), an offshore zone notorious for its lack of regulations. According to the homepage, this company is called Silwana Brokerage L.L.C, but the legal documentation shows that the company name is actually called Silwana Brokerage In Commodities Listed In Local Markets L.L.C.
This company is indeed listed in the Financial Services Authority of St. Vincent and the Grenadines (FSASVG) database. But this provides absolutely no guarantees to the customer. As soon as you open the website of the FSASVG you see a warning that the institution does not license brokers and does not regulate the activities of International Business Companies engaged in such activities.
Some large brokerage firms set up offshore subsidiaries, including in SVG. The aim is to be able to compete successfully in unregulated emerging markets in Asia and Africa. But these companies want to maintain a good brand name, which is why they provide guarantees and transparency even for clients of their unregulated divisions. This cannot be said of the Silwana Brokerage, which is simply an unregulated company that may or may not offer the services it claims.
Especially if you are a novice trader, it is not justifiable to risk investing through an offshore broker. Depending on your location, it is advisable to choose a company that is regulated by an institution such as Commodity Futures Trading Commission (CFTC) in US, Australian Securities and Exchanges Commission (ASIC), UK’s Financial Conduct Authority (FCA) or some EU regulator like Cyprus Securities and Exchange Commission (CySEC).
Clients of these brokers receive protections such as negative balance protection and segregation of the client’s funds from the broker’s funds. In the EU and the UK, brokers must also participate in guarantee schemes that cover a certain amount of the trader’s investment if the broker becomes insolvent. These guarantees amount to up to 20 000 EUR in the EU and 85 000 GBP in the UK. However, the likelihood of such a bankruptcy is low because regulators also have significant net capital requirements that companies must maintain – EUR 730 000 in UK and Cyprus, AUD 1000 000 in Australia and at least 20 million USD in the United States.
SILWANA BROKERAGE TRADING SOFTWARE
Silwana Brokerage offers what is currently the most widely used software by brokers and traders worldwide – MetaTrader 5 (MT5). The software is available in desktop and mobile versions. Here’s what the desktop platform looks like:
You could always use the services of a regulated broker, the vast majority of which offer clients MT5 or the still very popular MT4. This will enable you to use the advanced features of these platforms without fear of being scammed. These platforms are preferred by the majority of brokers around the world because of their powerful automated trading capabilities, including Expert Advisor bots and customized scripts for backtesting trading strategies.
SILWANA BROKERAGE TRADING CONDITIONS
When you visit the website of a genuine broker you will find proposals for different types of trading accounts suitable for investors with different preferences, as well as detailed descriptions of trading parameters – minimum deposit, order execution method, tradable financial instruments, leverage, spread, swap, commissions.
Silwana Brokerage offers three types of trading accounts, but does not provide clear and detailed information about the trading parameters. Only minimum deposit and spread are mentioned in the account options. Even this limited information seems illogical – the more expensive Dynamic Account, for example, offers a higher and less favorable spread than the Standard Account.
The third account is titled STP and promises raw spreads of 0.2 pips. Such spreads are usually associated with ECN type accounts and come with a fixed commission per lot traded. The Silwana Brokerage Terms and Conditions mention a number of fees, commissions and other costs, but do not specify their amount.
The home page indicates that the Silwana Brokerage offers leverage up to 1:500, while the FAQ section states a level of 1:1000. Regulated brokers do not offer such levels to retail traders as trading with high leverage carries risks of sudden and excessive losses. A maximum leverage of 1:30 is allowed in the European Union and the United Kingdom and 1:50 in the United States.
The minimum deposit of 100 USD may seem low, but many licensed brokers now allow you to start trading with this amount or even lower.
SILWANA BROKERAGE DEPOSIT/WITHDRAW METHODS AND FEES
Silwana Brokerage’s website and Terms and Conditions explicitly mention a wide variety of payment methods – credit cards, bank transfer, cryptocurrencies and e-wallets such as Skrill, Neteller, PerfectMoney and Cashu. But in the deposit menu itself, the choices are much more limited – cryptocurrencies, bank transfer and the payment provider Stripe. Such inconsistencies and the focus on payment methods that do not allow refunds make us doubt that the Silwana Brokerage is legitimate.
Silwana Brokerage states that it does not charge deposit or withdrawal fees. The stated exception is that the customer has to pay bank charges if he withdraws money without trading.
HOW DOES THE SCAM WORK
Many people are looking for ways to make money passively, but do not have the necessary knowledge to invest in the financial markets themselves. This makes them a target for the many online scammers posing as brokers. If you come across some of them and give them your contacts, you will be contacted by skilled scam artists who will assure you that they can take on the incomprehensible aspects of investing for you. You will only be required to invest and take profits.
But when you try to collect even just a fraction of your money, it will turn out to be impossible. Your supposed profits will suddenly evaporate, or you’ll find that you have to meet impossible traded volume requirements first. Fraudsters often insert huge withdrawal fees into client agreements amounting to 10%, 20% or even more. You won’t be able to hold scammers accountable because they hide behind fake names and shell-companies offshore. Scammers also typically use non-refundable payment methods.
WHAT TO DO WHEN SCAMMED
First of all, you should be very careful not to fall straight into the clutches of other scammers. Another common scam is to promise money recoveries from fake brokers for an upfront fee.
If you used a credit or debit card for the transactions, you can charge a chargeback. Visa and MasterCard have a long period in which they allow such requests – 540 days. But keep in mind that fraudsters can dispute if you have provided them with a copy of your ID and proof of address. It would also be helpful if you alerted the authorities in your country and other people online to the activities of the scammers.