End of Year Scam Watch – Time For 2016 Awards!
Well guys, this has been a fast and furious year. It feels like it just started and all of a sudden summer is gone, leaves start falling, then snow starts falling and what do you know, it’s almost end of year. This means that we have to crown the Scam Watch King and see who’s The Good, The Bad and The Ugly of this entire year’s Scam Watch series.
Highest Number of Appearances In Our Monthly Scam Watch
It was a razor close race to the finish and guess what: It’s a tie! The ‘winners’ are Tradorax and BigOption, with 7 appearances each. They were featured in almost all of our monthly Scam Watch articles and it’s needless to say they are not fan favourites. The biggest disappointment comes from Tradorax because when they first launched they seemed like a trustworthy brokerage. Now they are doing their best to drive traders away by any means necessary. What Johan has to say about them shows their shady tactics (June Scam Watch):
Dishonourable Mentions
OptionRally, CTOption, Opteck. Each one of them is a ‘regular’ of our Scam Watch series. I’ve linked to their respective reviews, which were recently updated. Please read them before investing with these brokerages.
Most Common Scam/Complaint: Account managers trade clients’ accounts.
Unfortunately, this hasn’t changed much since last year but now there’s a new twist: as soon as the client asks for a withdrawal, the account manager (or someone with access to the account) places one or more large trades that take the account close to zero balance. Read Jon’s complaint below (from our July Scam Watch):
Dishonourable Mention: Autotraders and Robots.
Unfortunately, scams like Copy Buffett, NEO2 and similar are still a harsh reality and what’s worse is that people still trust them. Read one of many complaints below (taken from our April Scam Watch):
Worst Sales Tactic: Give us your money and we will bring you Huge monthly ROI.
This has been a problem for a long time, not only this year. Brokers are making promises that are impossible to keep and clients believe them. Some of the best performing hedge funds in the world can make around 40% Return On Investment (ROI) per year, but a Binary Options brokerage can make 120% per year? Hmm, I highly doubt it and I consider this one of the worst sales tactics this year. Promises, promises, but nothing in return. Check out Li’s comment from our October Scam Watch.
Dishonourable Mention
High pressure tactics (tons of phone calls to make you deposit), asking for more money saying that you will lower the risk and increase the reward if you have a bigger account, adding a bonus without the client’s approval. This type of tactics are seen with almost 90% of brokers these days so when you feel pressured, please RUN away.
Biggest Amount Of Money Involved In A Complaint
74,000 USD! The broker in case is Tradorax and the story goes like this: when the client asked for a withdrawal of 25,000 USD from his 74,000 USD account, the password was reset and they placed long term trades to the full value of the account. The trades will expire on the 29th of December this year so we don’t know if they will win or not but that’s not even the issue here. The problem is that the broker has a higher control over the account than even the account owner does. That’s totally unacceptable and I just hope that people will stop trusting unregulated brokers with such large sums. Below you can read the full comment, taken from our August Scam Watch.
Dishonourable Mention
OptionRally blowing 55,000 USD in a single trade. After losing 17,000 USD, the client invested and lost another 10,000 USD, then someone from the so called ‘recovery department’ asked for another 7,000 USD saying they will add 5,000 USD. Yes, lots of numbers, I know. After a period, the account was sitting at 55,000 USD and when the client asked for a withdrawal, all the money was placed on a single trade that lost. Result: zero account balance. It just goes to show that you should pick your brokerage VERY carefully. The complaint taken from our May Scam Watch is below:
Lowest Number Of Appearances In Our Monthly Scam Watch
Ayrex! This brokerage is a new addition to our Recommended List and we are glad to see they don’t disappoint. Their clients are generally happy with the way they are treated and trading conditions are fair. Good Job!
Honourable Mention: StockPair. Right from the start, they were a respectable brokerage and they are still going strong after many years in the business.
Good Bye 2016! 2017, Here We Come! Watch Out!
There you have it guys, this year’s biggest complaints and scams. I have to say that things are better overall but we are still a long way from a safe trading environment and one of the biggest problems in my view is the broker’s control over our money. I believe it should be illegal for any broker to decide how to use my money unless they have written consent from me. Maybe it is illegal, but they are still doing it. Anyway, it looks like regulatory watchdogs are starting to be more vigilant, so let’s just hope for a better 2017.