Forex trading is one of the most popular types of trading in the world. There are many reasons why people trade currencies, but one of the main reasons is to make a profit. With that in mind, it’s important to know the different types of fraud that can happen in this industry. Here are the two major types of fraud traders will come across when trading forex.
Types of Forex Fraud
Fraud is a serious problem. If you’re new to this, you may have heard the term “fraudulent activity” before or have seen it online. Here are some of the most common types of fraud in forex trading:
Sale/leaseback transactions: These are transactions that transfer ownership of an asset between two parties. There are many different types of sale/leaseback transactions that can take place in forex trading today. Commodities like oil and gold often lend themselves well to these kinds of scams because they can be sold for high prices and then leased back for lower than market value, making them a good target for fraudsters.
Theft: When someone steals your money by taking control over your own finances and using it illegally, it’s called theft. Theft is something that everyone should be wary of when investing; especially if you’re working with foreign currencies where there aren’t rules against it yet. It also isn’t uncommon for investment firms to charge fees on top of their commissions (which they could easily avoid by not selling the shares), which makes it even more tempting to invest with them.