Online Trading Day » Online Trading Fraud Awareness and Prevention

3 Kinds of Online Trading Fraud

Admin — Thu, 10 Jan 2008 18:19:04 +0000

Time: 10:35

From: Way West of Wall Street

Dear Friend & Subscriber,

There are 3 Kinds of Online Trading Fraud to Watch Out For

The CFTC provides information for you about other specific kinds of fraud.

Foreign Currency Trading (Forex)

Foreign currency trading scams often attract customers through advertisements in local newspapers, radio promotions, or on attractive Internet sites. These advertisements may peddle high-return, low-risk investment opportunities in foreign currency trading, or even highly-paid currency-trading employment opportunities. Precious metals scams often work the same way.
The CFTC urges you to be skeptical when promoters of foreign currency trading claim that their services or account management will earn high profits with minimal risks, or that employment as a currency trader will make you wealthy quickly.

Commodity Pool Operators

Commodity pool operators often solicit investments from friends, neighbors, co-workers, and fellow religious or social group members by using their reputations in the community or their personal relationships. In many cases, however, these investment schemes turn out to be fraudulent, and you can lose your entire investment, in many cases as a result of outright theft.
Individuals and firms that fraudulently solicit funds from investors for commodity futures and options trading are usually not registered with the CFTC. They may operate “Ponzi” schemes in which little or none of the money sent in by investors is ever invested as promised in the commodity markets. Instead, the operator of the scam steals the funds, and creates the illusion of a successful business by using some of the money put in by later investors to pay phony “profits” to earlier investors. This tactic makes it appear to investors that the investment is actually making money, which in turn attracts additional investors. Be wary of such payouts if you do not fully understand their source.

Introducing Brokers

Introducing brokers often use advertisements and infomercials on radio and television to promote commodity futures and options. These advertisements may claim that seasonal trends in the demand for certain commodities or well-known current events (such as a hurricane or a terror attack) create an opportunity to make big money by trading in commodity futures and options. They promise quick riches, like turning $5,000 into $20,000 in just a few months, with little risk.

Sincerely,

Michael MeAngelo

Watch Out For These Warning Signs of Online Trading Fraud

Admin — Wed, 09 Jan 2008 19:03:45 +0000

Time: 11:15

From: Way West of Wall Street

Dear Friend & Subscriber,

Yesterday we talked about Online Trading Fraud Awareness and Prevention. Today we are continuing to look for these Commodity Futures Trading Commission warning signs of online trading fraud.

Get-rich-quick schemes that sound too good to be true. There’s never a free lunch. Be very careful if you recently retired or came into money and you’re looking for a safe investment. You could be a very attractive target for a crook. Once your money is gone, it can be impossible to get it back.

Predictions or guarantees of large profits. Always get as much information as you can about a firm or individual’s track record and verify that information—even if you know the people involved or they are recommended by friends or relatives. If you can’t get solid information about your investment and the company, don’t invest. Before you invest, always check it out with someone whose financial advice you can trust.

Promises of little or no financial risk. Be suspicious if the firm or individual says there is little risk. Be suspicious if someone tells you that a written risk disclosure statement is only a routine formality. Written risk disclosure statements are important to read thoroughly and understand.

Claims of trading in the “Interbank Market.” If a firm claims that they will trade foreign currency for you in the interbank market, or that you should trade in the interbank market, be cautious. The term “interbank market” refers to a loose network of currency transactions negotiated between financial institutions, usually banks and investment banks, and other large companies.

Unsolicited telephone calls about investing. Be skeptical if someone you don’t know calls, emails, or sends a letter to you about investment opportunities.

Someone asking you to send cash immediately. Be very cautious if someone tries to convince you to send cash or transfer money to them immediately by overnight express, the Internet, mail, or any other method.

I am currently building a list of what to watch out for since some people out there use highly advanced copywriting (marketing) techniques that play on your emotions to get you to puchase high priced online trading classes and study programs

Sincerely,

Michael MeAngelo

Online Trading Fraud Awareness and Prevention

Admin — Wed, 09 Jan 2008 01:13:18 +0000

Many people often ask me what I think of a particular online day trading course or live class. Since the industry is flooded with all kinds of programs, it is impossible for me to give you my opinion on all of them.

I can make some general observations about Online Trading Fraud Awareness and Prevention.

The Commodity Futures Trading Commission (CFTC) is a good place to start.

The CFTC’s fraud awareness and prevention program involves

educating futures market users
protecting futures market participants and
reviewing information and complaints that market participants send to us.

The CFTC is the Federal agency that regulates the trading of commodity futures and options contracts in the United States and takes action against firms suspected of illegally or fraudulently selling commodity futures and options.

Before you trade in commodities or futures, know the kinds and signs of fraud and the basics of futures trading.

Protect yourself from the many types of commodities fraud that exist in today’s financial markets.

Be suspicious of a promise of high profits with low risk. Scams that falsely promise high profits with low risks are everywhere. Many are targeted at specific ethnic communities using the language of that community, from New York to South Florida, from the Southwest to California, and in other areas.

Be wary of any firm or individual offering to sell you commodity futures or options on commodities, including

precious metals, such as silver or gold
foreign currency, such as Euros, Yen, or Deutschmarks, or
crude oil, heating oil, unleaded gas, or agricultural products such as corn, soybeans, or cattle.

Be wary of any firm or individual offering to trade your money for you in commodity futures or options, or to pool your money with other customers.

The commodity futures and option markets are very risky and you can lose your entire investment very quickly. Anyone who claims otherwise might be breaking the law. Always ask for proof.