There are so many unregulated and scam brokers popping up here and there that there is hardly a day when we do not hear about another broker that we need to be aware of. This Thursday Australian Securities and Investment Commission (ASIC) has increased their blacklist adding Estonian broker 4XFX there.
ASIC warns 4XFX might be a scam
4XFX also goes by the name of FRG Europe Ou. As they state on their website the company is a leading trading brokerage that offers various opportunities through the simple and user-friendly platform. According to their statement company facilitates the trading of Foreign Exchange, cryptocurrencies, stocks, commodities, and indices. On their website, the company claims to be registered in Estonia and provides the following address: Harju Maakond Tallinn Kesklinna Linnaosa Roosikrantsi tn 2-K397 10119, Estonia.
No matter how persuasive and attractive the 4XFX and its services might look for some investors ASIC suggests not to deal with the company. The regulator warned Australian citizens not to deal with this broker as it does not have any license that allows the company to provide financial services in the country. As 4XFX is operating without the proper authority they might be involved in a scam, the regulator suggests.
As per as ASIC information the company has made calls or sent emails about their financial services investing, credits, loans or simply financial advice. Even though, they do not hold Australian Credit Licence from ASIC or Australian Financial Services (AFS) license. These licenses must be acquired by the companies who want to provide with financial services.
A global headache
Usually, Forex brokers that are regulated and authorized by ASIC are reliable ones, since acquiring a license by them is a difficult process that is also attached to high fees. Thus there are a lot of companies like 4XFX that are trying to sneak their operations into Australia without getting proper authority. Only the growing list of ASIC’s unlicensed company can assure you that 4XFX is not the only broker that you need to stay away from.
Companies that are working without proper authority are not the headache for ASIC only. Regulators in every country have the same problem with the brokers that are not regulated, are misleading customers and scamming them. So far it is a worldwide issue and regulators all around the world are trying to defeat it. This is why we constantly hear information about yet another regulator warning brokers and advises the countries’ citizens to be very careful before making investments.
Just this week a financial regulator in Germany, BaFin has issued the warning about Top Algo Trade. The warning was similar to ASIC warning, as German regulator reported the company is operating without authorization and does not have permission to provide financial services or to conduct banking activities.
Due to the high amount of unauthorized brokers in the Forex industry investors should always keep an eye on the news coming from regulators. As well as take some time to make own research to be sure that the broker they are starting to invest with does will not turn out to be a scam.