XCM Markets Review – 5 things you should know about xcmmarkets.com

XCM Markets Review – 5 things you should know about xcmmarkets.com

Rating: 1

Beware! XCM Markets is an offshore broker! Your investment may be at risk.

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XCM Markets is one of these scam brokers who put very little effort into making their scam scheme look believable. The broker’s website uses a generic template we have seen used by such scamers many times before and provides almost no essential information about the broker or its terms. We were not even allowed to open an account. Turning to a broker like that for trading would only result in huge losses for you – do not make that mistake.

XCM Markets REGULATION AND SAFETY OF FUNDS

XCM Markets is registered in St. Vincent and the Grenadines and is definitely not a branch of an established international brokerage regulated elsewhere. This makes us distrust this broker instantly – the FSA of St. Vincent and the Grenadines has warned investors and traders on multiple occasions that it does not regulate forex brokers and does not monitor their activities. This financial authority only supervises the banking sector and pays no mind to forex brokers – which means that pretty much anyone is free to conduct business in any manner they see fit. Registering a company in St. Vincent and the Grenadines is quite easy. Such offshore companies are also not subject to transaction reporting requirements which means that money transferred to them becomes more or less untraceable – if you get robbed, you would not even be able to learn who robbed you.

Brokers licensed in strict jurisdictions like the UK, the EU, or Australia are a whole other story. These companies are never anonymous so you would always know who is handling your money and how. They also have to report to authorities regularly and maintain a high standard if they want to remain in business. Licensed brokers have to maintain a certain minimum capital of €730 000 in the UK and the EU, and A$1 million in Australia to prove their financial stability and long-term approach. Client money must be kept in segregated bank accounts – this measure prevents you from losing your money in case of unfortunate events and proves the broker would not be able to use your money for its own business. Negative balance protection is mandatory – you can never lose more money than you have in your account as a retail client. UK and EU brokers are also obligated to participate in compensation funds – in case your broker goes bankrupt, you could receive a compensation of up to £85 000 in the UK and €20 000 in the EU. Probably the biggest difference between regulations is that compensation funds do not exist in Australia – which of course does not make Australian brokers a less worthy choice.

Turn to a licensed broker if you want to be sure your broker will be treating you fairly.

XCM Markets TRADING SOFTWARE

We were not allowed to open an account with XCM Markets and see what sort of trading software they have to offer – but whatever the case might be, such brokers usually refrain from offering pricier, more efficient platforms like industry leaders MetaTrader 4 and MetaTrader 5 and choose more humble and far less impressive web-based software.

These brokers can offer you the full MT4 or MT5 experience. Both platforms are widely popular in the community and that popularity is hardly inexplicable – MT4 and MT5 are two accessible, user-friendly platforms that also provide access to an abundance of charting and analysis tools, and additional features such as Expert Advisors, VPSs, Strategy Testers, a market for trading apps, signals (and the chance to subscribe to signals set by others), the possibility to develop your own trading bots and indicators, and so much more.

XCM Markets TRADING CONDITIONS

XCM Markets was not extremely clear when it comes to trading conditions. The broker supposedly offers access to a variety of instruments “commission-free and with any balance” – which might mean that you would be able to open an account for whatever amount of money you decide. However, there are many great brokers who would open an account for $10 or less – check out their offers instead.

The broker claims to offer a maximum leverage of 1:400 – which we could not confirm since we did not get access to any sort of trading platform or even to the client area. XCM Markets is an offshore broker – which means they could easily tempt clients with the offer of higher leverage. Leverage increases your capability of making bigger offers and could result in much bigger profits. However, it could also mean bigger, faster losses especially for novice traders and in states of high market volatility. Authorities in many countries have decided to limit the size of the losses they could suffer and have imposed leverage restrictions – which is why brokers in the UK, the EU, and Australia, for example, cannot offer leverage higher than 1:30 on forex majors to retail clients. It is also why some traders looking for the possibility to trade with higher leverage choose to turn to brokers based in jurisdictions where the laws relating to leverage are looser. This does not mean, however, that turning to scammers is worth it – enough reputable brokers can offer you relatively high leverage.

XCM Markets DEPOSIT/WITHDRAWAL METHODS AND FEES

Since we could not access the broker’s client area, we cannot be sure that all the payment methods the broker mentions on the website would be available. We saw the logos of Visa, MasterCard, Skrill, Neteller, as well as of different banks but with such scam brokers you never know – you might end up being forced to transfer money in a designated deposit method, usually, one that does not allow chargebacks. That is why you should avoid turning to scammers for complex financial services.

We had some difficulties accessing all of XCM Markets’ legal documentation but we did stumble upon the following clause regarding withdrawals in their Risk Disclosure:

So if a client does not make 10 transactions after each deposit – or does not wait a varying period of time depending on the size of their investment – they would not be allowed to withdraw any money from their account. This is ridiculous since no legitimate broker would ever deny you access to your money – but in the case of such scammers that is just a way of delaying withdrawal requests. Such clauses might become the subject of change and you might be forced to wait even longer – brokers like XCM Markets would do anything to keep your deposits for as long as possible and after you become convinced that there is something wrong, will just disappear with your money.

HOW DOES THE SCAM WORK?

Scam brokers are becoming more and more of a constant feature in the world of financial frauds – which means that more and more people are losing their hard-earned money by depositing it with such unreliable companies. We advise readers to always turn to licensed enterprises and thoroughly check registers. Let’s take a look at how such scams usually work and how you can protect yourself from them.

You stumble upon a broker who seems to offer fast, effortless, sometimes guaranteed profits – and decide that there is no harm in opening an account with it to see what it has to offer. After all, you have heard stories of people earning a decent income by trading – why not be one of them. You would not have to deposit, not immediately. But the moment you provide the broker with your phone or email, they would not leave you alone before you do so. You will be promised all sorts of great things – after all, these are people who scam people for a living and who are well-accustomed to convincing. The initial deposit might not be big – but you would be asked for more and more money with time. In some cases, you might even see that money grow – but that is nothing more than a trick that usually involves some sort of platform manipulation.

A time will come though when you will want to withdraw money – and you would not be allowed to do so. The broker will claim that you have not fulfilled a clause in the Terms and Conditions, that there are additional taxes, and that you are obligated to wait a certain time before withdrawing. At this point, you will understand that you are being scammed – but the broker will disappear as soon as they discover they can no longer milk you.

WHAT TO DO WHEN SCAMMED?

The first thing you should do is change all your banking passwords, and uninstall any remote access software (if you have installed any). After all, you would not want the scammers to have any sort of access to your bank account so they could drain it.

Do not trust any so-called “recovery agencies” who ask you to pay a fee so they could track down the broker and retrieve your money – this is a whole other type of scam targeting desperate people. What you should do instead is inform the actual financial authorities, and look into chargeback options – both Visa and MasterCard, for example, battle scams by allowing chargebacks within 540 days of the transaction.

One final thing – it is important to share your story with as many people as possible. The more people know about this sort of scam, the fewer people will fall victim to it. Unfortunately, such stories rarely get a happy ending – which is why prevention is key.

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