Watch Out For These Common Signs Of Online Broker Scams

broker scam

Online trading has a large number of scams that prey on retail traders. Because fraudsters may now operate from any location, especially thanks to the internet, they are more confident, and it is more difficult for law enforcement to find them.

It is best to recognize a broker scam before you fall for it and lose money. By keeping an eye out for frequent indicators of an online brokerage/trading platform scam, you can avert additional harm to your finances if you are already involved and leave immediately.

1. Cold calling:

An alarm should go out if a broker phones your number and starts pitching you on their services. Where did they find your phone number? And why do they believe you are old enough to trade on the internet? You might be marked by a scammer.

There are instances when the calls get obnoxious, and you can tell the caller is desperate for you to do business with them. From that point on, you must proceed with caution.

Even if you are not approached by phone, you might be invited to a WhatsApp group or contacted about investment opportunities on Facebook or Instagram. It would be best if you were skeptical of whatever they say because studies have shown that social media is where the majority of internet investing frauds are perpetrated.

A large WhatsApp group does not guarantee the legitimacy of the investment offer. Even though most investors know that a particular investment is bogus, they nevertheless want to try their luck before the con artist plays out the scam and vanishes.

2. Negative online reviews:

Even if a broker is licensed, you should still look into them further since they may still choose to abuse the confidence that has been placed in them.

You can read online evaluations from the mobile app store where you downloaded the broker’s trading app or perform a straightforward Google search. While it is true that no broker is flawless, some warning signs may point to more serious issues.

Look for comments regarding trouble withdrawing money while reading evaluations of your broker. Your account’s withdrawal process should be as simple as its deposit process. If there is an excessive delay in receiving your money, the broker can act dishonestly and should be avoided.

If there are also concerns regarding price requoting, the broker might manipulate the market with a sophisticated algorithm.

3. Blackmail:

To allow you to access your existing investment, some brokers will want you to make more deposits or purchase additional products. If you cannot raise funds for the new investment, you risk losing your previous investment.

If you find yourself in this situation, it’s best to stop making new financial commitments and notify the appropriate regulatory bodies.

Summary:

You should be alerted if a broker calls your number and begins pitching you on their services. You might hear from someone about investment opportunities on Facebook or Instagram even if you’re not called. According to studies, most internet investing frauds are committed on social media. A huge WhatsApp group does not imply that an investment offer is legitimate. A broker should still be thoroughly investigated even if they are licensed.

The broker might be behaving dishonestly if your money is received with an excessively long wait. Some brokers may ask you to make further deposits or buy more items.

Also check about – 5 Steps to Select the Best Wall Hangings

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