FCA Warns Traders of Clone of FXOpen

CIOReviewindia Team | Friday, 10 July 2020, 08:59 IST

FCA Warns Traders of Clone of FXOpen

The Financial Conduct Authority has once again warned investors about companies imitating licensed Forex brokers. The British regulator said that because these companies operate very similar to UK-approved providers, spotting the difference makes it hard for unsuspecting investors.

The FCA recently made an update available on its website, blacklisting UK Forex, a Forex company operating through the website, https://www.uk-forex.com/. According to the investigation conducted by the watchdog, it was revealed that UK Forex is a wholly clone of London-based broker, FXOpen Ltd.

As of writing, UK Forex’s website cannot be opened. It’s not clear whether it was shut down due to FCA’s warning or because of other reasons.

But the clone broker seemed to be focused on offering cryptocurrency products, according to a cached version of its website. FXOpen has recently been involved in increasing its crypto portfolio. Like other companies in the industry, it’s been expanding its offerings to meet the growing demands of clients.

FCA’s Stricter Control

As scams continue to threaten the financial industry, the FCA has been imposing stricter measures to protect the public. Not only does it intend to protect them from fraud companies, but also from regulated Forex brokers that may offer services causing similar damage.

The regulator has always been vocal about its goal to hunt fraudsters down. The watchdog has also recently outlined its concerns regarding financial advertising, which wrongly suggested that all of a company's activities were supervised by the FCA or other financial agencies when in fact, they’re not

Rise of Forex Scams

Scams in the Forex market are nothing new. The market is massive with over $6 trillion global daily trading volume, making it a good place to milk money from people. Scams in the industry come in various forms, and come from different sources. Because of the advent of technology, it’s become much easier for fraud Forex brokers or individuals to flock the largest financial market using more sophisticated and deceptive tactics. Their goal is to entice vulnerable people into investing by promising guaranteed return on investment. You’ve probably seen a lot of such offers on advertisements online. There’s no such thing as a guarantee in any kind of investment. When you feel like the offer is too good to be true, then it probably is.

Be More Careful

Over the years, financial regulators like the FCA have warned traders and investors to be more careful on where they put their money on. They’re advised to do some careful consideration, and background check first on the Forex brokers they intend to trade with.

As we always say, fraudsters are everywhere, and the Forex market has a lot of them. If you have a broker in mind, make sure it’s legally operating, and is licensed by credible regulatory agencies like the FCA, NFA, or ASIC. Furthermore, make sure to have a thorough look at its trading services and products offered to make sure they are suitable for your needs as a trader.

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