Beware! PrimoTrade is an offshore broker! Your investment may be at risk.
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PrimoTrade is an offshore broker that offers trading in Forex, Indices, Futures, Stocks, Commodities and Cryptocurrencies. They have five types of accounts starting from a $1000 minimum deposit requirement with up to 30% bonus, and going to $20000 with up to 100% bonus. They do not advertise a Demo account, nor did we find such options in their client area or trading platform.
To register for a Live account we had to provide First and Last names, Email address, Phone number, and Country of residence. At completing the process successfully we were redirected to the client area, but there was no confirmation or any other email sent to our mailbox. This was the first sign that not everything is legit with this broker since any provider of online services, especially financial, will make sure there is an email engine implemented on their website.
PrimoTrade Regulation and safety of funds
The broker’s website is owned and operated by Malarkey Consulting LTD, company registration number: 2020/IBC00078 and registered address 8 Copthall, Roseau Valley, 00152 Commonwealth of Dominica. Dominica is an offshore jurisdiction in the Carribean that does not regulate forex brokers, which makes it an attractive destination to register a company in a quick and easy way.
The Contact Us page provides two UK phone numbers (for German and for English clients) and an email address. Because of the phone numbers we decided to check with the United Kingdom regulator, the Financial Conduct Authority (FCA), but neither PrimoTrade nor Malarkey turned out to be registered with them.
PrimoTrade is very big on words – they will promise you 100% funds security because they comply with “wide ranging security of funds requirements” and professional trading conditions which are “amongst the best in the industry” – just see below:
The fact is they are misappropriating the requirements for licensed and regulated brokers, but since they are NOT regulated, there is no oversight over the broker’s compliance to them. The claim of “investment-grade banks” below is also aimed at providing this false sense of security because one would think there are good liquidity providers behind the broker.
Top watchdog agencies, such as the FCA and the Cyprus Securities and Exchange Commission (CySEC), impose strict rules on their licensees – Client Account Segregation requires that clients’ funds are kept separate from the broker’s operating funds. while Negative Balance Protection ensures that traders cannot lose more money than what they invested. Other policies include a Minimum Capital Requirement of 730,000 EUR in order to guarantee the broker’s good financial standing and participation in Compensation Schemes, which provide additional assurance for investors’ funds up to a certain amount (85,000 GBP in the UK and 20,000 EUR in the EU).
PrimoTrade, however, is an offshore, unregulated broker, so anything they say or promise on their website should be taken with a grain of salt. They may claim your money is safe with them, but we would not advise risking that.
PrimoTrade Trading Software
The broker offers the MetaTrader 4 (MT4) platform as a Desktop and Mobile (Android and iOS) application. MT4 is the world’s number one platform, preferred by more than 80% of users. It offers an intuitive and user-friendly interface, sophisticated charting and analysis tools, as well as copy and auto-trade options. It can be further customized to create different trading strategies using its proprietary MQL4 programming language.
PrimoTrade also presents some web-based trading software, Webtrader, which is very far from professional standards in terms of design and functionalities. Actually, it does not offer even a fragment of the features established platforms, such as MT4 or MetaTrader 5 (MT5) provide, not even a Demo account.
PrimoTrade Trading Conditions
The broker’s trading conditions are very far from “the best in the industry”. Legitimate, regulated brokers would never offer more than a 1 – 1.5 pips spread for EURUSD, whereas in the screenshot above we see a 8.1 pips spread for this most traded currency pair. Such a wide spread makes the cost of trade very high and is not competitive at all. It guarantees hefty profits for the brokerage on the back of traders’ losses.
In the trading platform we were assigned a leverage of 1:100 and there was no way to change it or ask for a change of the account conditions in the client area. On its website, however, PrimoTrade advertises “powerful leverage options up to 1:400”. Trading on such high leverage comes with significant risks, especially to inexperienced traders. Although in theory it allows for bigger profits, one may incur great losses too, often much greater than the invested funds. That is why, most regulatory authorities impose leverage caps for non-professional traders: in the USA it is 1:50, while for brokers licensed in the EU and the UK it is 1:30. The Australian Securities and Investments Commission (ASIC) also recently announced that from 29 March 2021 it will restrict leverage for major currency pairs to 1:30.
PrimoTrade Deposit/Withdrawal Methods And Fees
PrimoTrade provides the standard payment methods – credit / debit card and wire transfer, as well as different ePayment options via a Russian electronic payment platform, Piastrix. Popular methods, such as PayPal and preferred by traders e-wallets, eg. Skrill and Neteller are not supported, however.
The minimum initial deposit is $250, which is more than double the standards of regulated brokers which ask for $100 from the traders on average. The minimum withdrawal clause is also unfair – whereas most legitimate brokers do not put a threshold on the withdrawal amount for their clients, PrimoTrade requires a minimum of 250 USD/GBP/EUR for wire transfer and 100 USD/GBP/EUR for any other method.
And this comes with significant transaction fees too. In addition to the 50 USD/GBP/EUR for wire transfers, 25 USD/GBP/EUR for credit cards plus a processing fee of 10 USD/7 EUR/5 GBP and 25 USD/GBP/EUR for ePayments, there is a levy of 10% of the withdrawal amount if the account has not executed more than 200 in turnover! They also have an inactivity fee: if you did not login and traded from your account within three (3) months, your account will be subject to a deduction of 10% each month. Regulated brokers rarely charge such fee, and if they do, it is usually a flat fee of no more than $10 after at least six months.
Considering everything above, we warn our readers to stay away from PrimoTrade as they are an unregulated, offshore broker – definitely a scam!
How does the scam work?
Users often fall prey of very simple but quite efficient scams. The first snare is usually an internet ad promising big profits over a short period of time, and all you need to do is provide your personal information, usually email address and phone number. If you do that, you will start getting calls from scam brokers who will continue with the pitches of quick and easy profits until you decide to make a first deposit of $200 to $300. On these funds the scammers get a fat commission and transfer you to senior “brokers”.
These expert con-artists are smooth talkers who start talking you into putting even more money in, because “now is the perfect moment” or “the more money you invest, the higher your profits will be”. Usually about this time most traders will start to feel the scam and will want to withdraw their money and get out fast.
Unfortunately, the scammers will not give in easily. First, they will try to persuade you not to withdraw right now because you will miss on “big profits”, and if that does not work, they will find numerous reasons to deny or delay your request by asking you for additional documents or claiming that there are some other causes for not executing the withdrawal. The ultimate objective in such procrastination is to make the traders miss the crucial period in which a chargeback request can be filed, and thus lose the chance of getting their money back.
What to do when scammed?
If you used a credit card to make a deposit with the scammers you should immediately file for a chargeback. Both VISA and MasterCard have increased the time in which you can file to 540 days, in part specifically to fight such online scams.
If you used bitcoin or bank wire, however, chances of recovering your funds are slim. You might get approached by so-called “recovery agents”, but don’t fall for their tricks. They will ask for payment up-front to recover your money, but this is just another scam and you will not get anything back.
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