People lose billions of Rands online. More and more people are succumbing to the advertising pitches of trading sites, sites that offer you to put your money on financial products, while booklets A and other savings products earn almost nothing. Problem: if some of these sites are legal and authorized by South African regulators, others grow like mushrooms and are in fact crooks.
Forex, binary options, credit offers, atypical products, and these sites diversify their investment offers and may therefore make more and more damage. South African online trading explains how to avoid these scams.
- What are the risks?
The first risk is that you lose your money in minutes. No a trader who wants, whatever the commercials of the sites of trading say. It is very difficult to predict the evolution in the very short term (a few minutes, a few hours, a few days) of the price of a currency, a stock index or a raw material, insist the authorities. In addition, on the Forex or via CFDs, trading is offered with what is called a ‘leverage’ that multiplies gains or losses. It can go up to 1000 times setting!
- What should you be wary of to avoid the pitfalls?
Several techniques used by illegal sites can alert you, provided you pay attention. We must be wary of the profitability rates that some pharmacies can offer: there are no guaranteed high returns!
First of all remind the authorities. You have to be wary of the speeches of so-called ‘advisers’ who, without even knowing the savings of the investor, will offer ‘innovative products reserved for a few privileged’.
Lastly, do not give in to adrenaline. We must also know how to resist the pressure and think before acting. If the ‘advisor’ indicates that tomorrow it will be too late, that these are the last opportunities … the only advice to give is to flee!
- How to check if a site is authorized in South Africa?
The money must be placed with authorized interlocutors and authorized by the authorities that have a storefront. How to recognize them? To complete a verification, simply enter the name of the name of the organization in the search engine. Other online sites help you check the financial intermediary’s authorization.
- Conversely, can we tell if a site is illegal?
The AMF regularly publishes black lists of websites and entities offering risky investments in South Africa, without being authorized to do so. These lists focus on Forex (currency market) and binary options products. Warning, this list may not be complete because new unauthorized players appear regularly, warns the regulator.
- What are the solutions for fraud?
There is virtually no recourse, because of the location abroad (Cyprus, Malta, Russia or Israel) of these crooks. However, they use complex and ephemeral montages. This makes their identification and their location difficult. The authorities advise to file a complaint promptly with the public prosecutor. However, be aware that compensation will be very difficult to obtain, if not impossible. Even before the customer became aware of the scam, the site siphoned money that was immediately transferred to tax havens where it becomes untraceable.