If you’ve fallen for a fraudulent broker and you’re working with the wrong broker these are some of the ways you can fall for a CFD trading scam and how you can be scammed. Let’s discuss each way one by one and let me take you through all the numerous ways you can be manipulated by fraudulent brokers. If you need more information on these scams and frauds you can easily obtain all such information on the Ezchargeback website. Now you might be wondering what Ezchargeback is and why do we need it?
Let me make it simple for you, Ezchargeback is a company that specializes in fraud detection and they have a website which is very informative and contains all the information regarding CFD trading fraud. For all the beginners this website is excellent to guide you through so do check it out. Without further wait let’s dive into the CFD trading frauds.
1. Commission on top of spreads
This is amongst the worst ways you can get scammed on CFD which is spread on top of commissions. Let me explain both concepts so spreads are primarily the differences which is evident in the buying and selling prices of the assets when you buy them from the broker. So basically if you buy an asset for 2 dollars from a broker and if you try to sell it back he might pay you 1.8 dollars and this difference is what aids brokers in making money. Now if the commission of the broker is above the spread you’ll be paying more each time you trade with this broker. You’ll never be able to make money with this broker since you’ll be paying more money on each trade.
2. Unnecessary and irrelevant obligations on withdrawals
So whenever you sign up with a broker you’ll have to make an account which requires you to give a lot of important information. If you get unlucky and get a bad broker he’ll ask for a lot of your important information whenever you want to withdraw your funds. They will apply different obligations on you which are unnecessary and in reality you can easily withdraw funds from your own account whenever you want. Scammers and fake brokers will apply all sorts of policies and obligations making you give your personal information to them whenever you withdraw your money.
This is something you want to avoid at all costs if you sign up with an online broker. You’ll notice how good brokers will always tell you that there are no requotes on their trading platform whenever you sign up with them. This makes it clear that requotes are not a good thing and any broker saying they are is likely to be a fraud. Through this brokers can stop you from entering beneficial trade and as soon as you realise you can get a profit on the trade they’ll send you re-quotes.
4. Cash deposits
If you’re not familiar with the digital trading world, let me tell you something: cash deposits are no longer used and it is often discouraged and prohibited. Online brokers are not allowed to take cash deposits from their traders since there is no way of keeping a record of it. This is why you need to send money from your trading account to have proof of the transaction.