With the rise in the popularity of foreign exchange trading, there is also a rise in scam artists who target beginner Forex traders who do have the experience or knowledge of how to spot a con. When you know what to look for it is actually quite easy to spot one of these cheats and you can either avoid them or report them to the authorities. So here you will learn the art of spotting an forex fraudster.

An increase of online trading facilities provides a whole new playing field for these scammers, however there are still many who will attempt to con you via the telephone, newspaper articles and maybe even on TV.

Too good to be true

Follow this cardinal rule: If it looks too good to be true it almost definitely will be. Any forex firm that claims to have developed a scheme that will guarantee you to profit with no risk will be lying to you. Like any investment the foreign exchange market is hugely risky and it is not a get rich quick scheme it requires research, learning and confidence.

Guarantees of large profits

Do not believe a firm that outwardly guarantees you success and instantly large profits. Undoubtedly, you will have to invest a huge sum of money that is not actually going to make a profit, but the firm will. They use the word guarantee to draw in their victim by promising things that simply arent true. The forex market is incredibly volatile at times so there will never been any guarantee of profit.

Check that they are CTFC member

You should be wary of any firm that does not advertise that they are a CTFC member. Never sign without checking the background of a company or forex broker. Even if they do advertise it on their website make sure you dig deeper and research the firm in question thoroughly. Speak to friend or work colleagues who are involved in the forex market and see what they suggest. Go online and see reviews. Word of mouth is the most effective way to find out whether the company in question is a scam artist or not. Learn from other traders bad experiences and be wary of who you invest with.

So, before parting with any of your money ensure that you thoroughly research the firm or broker. Forex is already a tricky enough business you do not want to be dealing with scam artists on top of everything else. Speak to other investors and traders, see what they have to say and remember, if it sounds too good to be true it will probably be.