How to Report an Online Trading Scam?

As long as the internet has existed, there have been online scams. Of course, scams and frauds have been with us since the beginning of time, but the internet is particularly well-suited to these illegal forms of activity. Online, it’s easy to take money, it’s easy to appear to be something that you’re not, it’s easy to disappear, and it’s easy to cover your tracks.


It’s a sad fact that many cheated investors are unsure about how to report internet fraud. In addition, they may be reluctant to come forward and draw attention to the fact that they’ve been scalped. Worst of all – and most regrettably – fraudsters often play on people’s reluctance to publicly admit that they were swindled.


Forewarned is forearmed. With knowledge of the most popular types of scam – and of the tactics commonly used by the fraudsters – you can avoid many of the dangers inherent in online trading. This guide tells you what to watch out for. And for anyone unlucky enough to have been ripped off, read on to learn how to report an internet scammer and some less obvious solutions that might help you get your money back.


Trading scams come in many shapes and forms, but they all have one thing in common: to make off with your money illegally. When you’re looking to trade online, watch out for the following scams:


  • Unscrupulous brokers who trade unfairly or illegally, charge exorbitant fees, and make it extremely difficult or impossible for you to withdraw your money


  • Sham companies that are here today and gone tomorrow. Such trading companies are often based in off-shore locations, and they carry bogus or stolen registrations


  • Dubious investments schemes, often in old favorites like precious metals, gems, oil, and mining, or in the latest “next big thing” markets like cryptocurrencies, high techs, green energy, and the legalized US marijuana industry


  • Costly automatic trading software packages or robots (especially for forex) that don’t deliver the promised returns 


  • Phony financial gurus who, in return for an expensive subscription, offer you expert advice that’s anything but


It’s important to note here that just because a company is prestigious and well-known, that’s no guarantee of probity. There are plenty of examples of big firms that have been found guilty of sharp practice, either through the actions of a rogue employee, or more worryingly, through illegal policies sanctioned at the highest levels.


Regardless of where you’re investing, it goes without saying that you should always do your research and due diligence.


Some fraudulent schemes are so obvious that it’s a wonder that anybody falls for them. We’re thinking of shoddy websites, badly written emails full of poor grammar, or billionaire royal family members who’ve apparently fallen on hard times!


For every single investment opportunity, it’s vital that you do your homework. Even the most cursory research should be sufficient to set the alarm bells ringing where necessary. Make sure you read the online reviews, Google the company name, check out staff on LinkedIn, confirm the company is properly licensed and regulated, plus verify the website has a physical address associated with it. If you can’t be bothered to spend a few short minutes doing such research, you’re setting yourself up for a fall.


However, if it was that easy to detect all scammers, then there would be no need for articles like this! The unwelcome reality is that some schemes are extremely elaborate, clever, and authentic-looking, and that makes them much harder to spot. But even then, there are often clear warning signs, such as:


  • Fake celebrity endorsements: ask yourself why a famous multi-millionaire would want to be involved with a trading scheme


  • The promise of unbelievable guaranteed high returns: every investor knows about the dangers of pyramid and Ponzi schemes, but people are still taken in


  • Time-limited offers: watch out for schemes that encourage you to act immediately or miss out, as they may be playing on your better judgment


  • Fake websites that expertly copy the look and feel of an authorized brokerage or that steal the identities of genuine traders


  • Pictures of beautiful people enjoying a fabulous lifestyle, full of yachts, fast cars, and fancy houses


Wise up to the tactics employed by the more sophisticated fraudsters, and you’ll be far less likely to fall for their scams.


If you suspect that you’ve fallen victim to online fraud – for example, you want to report a forex scam – your first action should always be to contact the company concerned, because in some cases, it may not itself be aware of the scam. If that approach isn’t realistic or possible, then you should contact the relevant national financial regulator, especially if the company is registered there.


In many countries, regulators generally have an excellent reputation, with a strong track record of cracking down hard on unscrupulous traders and brokers. However, sometimes the regulators’ hands are tied, or there may be a particular reason why they’re unable or unwilling to act: political interference, for example, or a lack of up-to-date legislation.


In other jurisdictions, particularly in emerging markets, light-touch regulation is frequently the order of the day. In such cases, you may find you have little or no recourse, especially if you’re using non-national trading in a foreign country.


If your interactions with the regulators are proving to be ineffective, you could consider contacting the national media to highlight any injustice or start an online campaign with reviews that draw attention to immoral corporate behavior.


You’ve contacted the scam company, regulator, and the media, and you’ve left highly critical reviews online. But nothing has changed. You still can’t get your money back, and the scammer has got away with it. All is lost, right?


Well actually, no. If you’ve exhausted the options mentioned above, there’s still another course of action open to you, and one that’s proved to be highly effective. Companies like PayBack offer a dedicated funds recovery service that can help you get back what’s rightfully yours. The service is quick, efficient, confidential, and cost-effective. When faced with highly experienced legal and financial professionals, many scammers soon cave in to the pressure. 


There are plenty of examples of investors who thought their money was gone forever but got it back thanks to PayBack. If you’re an uncompensated victim of online fraud, this is an avenue that’s risk-free, and one that’s definitely worth exploring.


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