September 24, 2014 by Fred

If only it was this easy to spot trading app scammers

There used to be snake oil salesmen, the Nigerian Prince con, and the real estate bait and switch. Scam artists are always present in every generation and their tricks are becoming more and more elaborate. Every year, several incidents are reported where high tech scams are committed not just by your run-of-the-mill hacker, but by smooth talking trading software salesmen. Here are three red flags that you can keep an eye out for before you pump any money into any trading platform. Here’s to hoping that you get to read this before using any trading software.

Does it promise huge returns? This is one of the truest tests of a scam. Unrealistic returns such as 22% weekly may sound tempting, but you’re better off rubbing two pennies together. I’m sure you have that one family member who’s already told you, “If it sounds too good to be true, then it probably is.” Remember: the difference between a thief and a scam artist is that the thief finds the stealthiest way to steal, while the scam artist plays on the victim’s own greed.

Does it use terms that you’ve never heard before? While we’re all sold into the idea of getting in first on a new idea, if the trading app that you’re looking at is putting on a verbal show for you and you’re trying to mentally catch up, watch out. A classic scam artist trick is to use big words to try and show the victim that, “Yes, we know more than you do, and you should trust us completely.” Instead, try to find one that can explain everything to you in full detail and in the simplest words possible.

When faced with any opportunity

Does it try to pressure you into the sale? Now this is the easiest way to spot a scam. Any salesman will try to put a sense of urgency into the deal, but if you’re just trying to close the window to the sales page and popups keep pestering you, then you are almost certainly looking at scam software. Legitimate trading apps already have a large volume of traders, and so they wouldn’t be peddling their wares desperately. If the product “just happens to be on sale right now” and you could end up “losing more money” if you don’t make the purchase within the next 15 minutes, just close the window and keep searching for better options.

See, scam artists may have evolved over the years (i.e. leveraging technology, dummy bank accounts and a very inconspicuous digital footprint) but the telltale signs remain the same. Watch out for these three red flags and find yourself a reputable broker with reliable trading software that you can work with.