Beware! Traderfex is an offshore broker! Your investment may be at risk.
RECOMMENDED FOREX BROKERS
Don’t put all your eggs in one basket. Open trading accounts with at least two brokers.
Traderfex is an offshore broker claiming to be a worldwide trading provider enabling traders to access an umbrella of thriving markets and viable assets. Well, we don’t know what they are talking about, but it’s a Forex broker promising big, so we have to put it on the list of suspected scams due to the false sense of hope they create. The rest of the details about this suspicious business are in the full Traderfex review.
Traderfex REGULATION AND SAFETY OF FUNDS
Traderfex is incorporated in St. Vincent and the Grenadines, so it’s unregulated. The country is a non-transparent offshore jurisdiction where the local regulator SVGFSA doesn’t even license Forex brokers. In fact, we can’t even get any third-party information about this entity, so it’s totally anonymous and may as well be legally non-existent. Not surprisingly, scammers truly enjoy SVG, and that’s only because of the transparency and regulations deficit. Those things considered, we can conclude that your funds won’t be safe if you deposit with Traderfex.
The screenshot below shows precisely what a lack of regulation means. As you can see, the broker reserves the right to steal their clients’ money whenever they want, blaming regulations, laws and authorities for the so-called charges. That’s a scam!
As Traderfex is likely fraudulent, you can see the high-rated EU brokers and British brokers on both lists if you are interested in trading. The European companies are well regulated, but most importantly, covered by deposit insurance funds created to protect investors’ money if things go wrong. For example, CySEC brokers’ clients can claim up to 20 000 EUR in case of bankruptcy, while the British guarantees are up to 85 000 GBP. As an FCA licensee, TeraFX is a part of the British fund FSCS, so their clients would be able to place their claims. However, we wish they don’t have to do so.
Traderfex TRADING SOFTWARE
Traderfex provides its clients with web-based software that’s inferior to the MetaTrader distributions, for example. The indicators are unreliable, the charting tools challenging to use, and sophisticated features such as automated trading entirely missing. In fact, the platform is so poor that it would be suicidal even to try implementing some robots to trade for you.
As the Traderfex platform is deficient, we can offer the high-rated MetaTrader4 brokers and MetaTrader5 brokers on both lists while talking about software. The MTs are market leaders packed with advanced features such as Expert advisors, many indicators, and excellent charting tools. The software also includes a marketplace with more than 10 000 apps and third-party developed solutions, which is an unrivalled advantage. In fact, recently, MT5, for the first time, surpassed MT4 in terms of brokers offering the platform, but its trading volumes are still lower. Nevertheless, both MetaTraders are much better than the poor platform offered by Traderfex.
The EUR/USD spread is 3 pips or 3 times worse than the industry standards on average- 1 pip or less, so we can label Traderfex as a costly broker. The leverage is said to be 1:100, but we can’t validate this information. In fact, clients can’t access the leverage levels or change them, which is strong evidence of a scam. In fact, leverage is so dangerous that it’s been a subject of regulations for years in some jurisdictions. Namely, licensed EU, British and Australian brokers have to limit retail clients to 1:30 for FX majors, while Canadian brokers and US brokers to 1:50. Swiss brokers are trustworthy but not leverage restricted, so experienced, and risk-tolerant traders eligible to open an account in Switzerland can safely go for it.
Traderfex DEPOSIT/WITHDRAW METHODS AND FEES
The minimum deposit is $250, which is slightly more than the regulated brokers’ demands on average- around $100. In fact, some legit companies even offer accounts starting from 5 to 10 dollars, so there are much better options than Traderfex. The funding methods are Wire Transfers and Credit/Debit cards, out of which the latter considerably safer due to the chargeback rights guaranteed by issuers like Visa and MasterCard. Thus, clients can dispute transactions and get a refund within up to 540 days after the transaction.
Nevertheless, while talking about deposits, see our lists with Skrill brokers, Neteller brokers, FasaPay brokers, Sofort brokers, and Bitcoin brokers if you have a preferred e-wallet or a trusted payment system. The high-rated companies are well-regulated, and you won’t face scammers, so you can safely open accounts.
The withdrawal requirements are burdensome. The minimum withdrawal is 500 units for Wires and 50 units for Credit/Debit cards. Allegedly, the latter is free of charge, but the Wire costs 20 units, which is unfair. In contrast, most of the regulated brokers impose no or minimal restrictions, so clients can take out as little as they want for free. Traderfex claims to process withdrawal requests within 5-7 days, which is a lifetime (regulated brokers deal with the matter for 48 hours at most).
The inactivity fees are equally unfair. An account becomes dormant after 3 months of inactivity and will be charged 50 units per month. That’s unacceptable. The reputable brokers take a maximum of 5 to 10 dollars per month.
Traderfex is offering bonuses, but the additional clauses significantly worsen the conditions. If clients accept trading incentives, they have to execute a minimum volume of 30 times for every 1-unit bonus to become eligible for withdrawals. The worst thing about this clause is that the broker doesn’t specify what 30 times means- lots, micro-lots or dollars. So, let’s say you accepted a $1000 bonus. Traderfex can freely ask you to trade 30 000 lots (3 billion USD in turnover), which is totally out of reach. If you accept incentives you may end up unable to take any money back, so we strongly recommend that you should reject the broker’s bonus offers.
Overall, Traderfex is an unregulated offshore broker, which is more than enough for you to stay away from this highly suspicious business.
HOW DOES THE SCAM WORK
The scam usually starts with the deceitful ad, the cold call or the fraudulent social media profile, and once you get enticed, you’ll be constantly manipulated by the con artists. In most cases, the scammers will claim to manage your account and will show you winning trades at the beginning to make you believe it’s worth dealing with them. By doing so, they aim to gain your confidence and trust, which helps them in the following stages.
From there on, scammers won’t let you withdraw profits but will constantly urge you to invest, again and again, asking for much greater sums. Make no mistake about it; those criminals will try to squeeze as much as possible from you, so they’ll advise you to put all of your savings in the scheme.
You’ll probably understand what’s going on as soon as you try to get your money back. At this point, scammers will try to persuade you not to do so and will even shamelessly say that you can’t withdraw unless you deposit once more. If you are persistent and refuse to follow their instructions, they will simply cut the communication and close your account. Then, whenever fraud becomes publicly exposed, scammers will abandon the website and create new ones, carrying on with their criminal activities.
WHAT TO DO WHEN SCAMMED
Unfortunately, no one is immune to scams. If you get scammed, the first thing you need to do is to consider the secondary risks. Deactivate your credit card and contact your bank and ask for advice.
Then, report what happened to you, file a complaint, contact the authorities, call the police if you feel necessary. Seek help actively!
Remember, it’s crucial not to rush blindly to recover funds because fraudulent chargeback agencies and individuals are stalking, trying to double scam the victims. They ask for upfront payment, take the money but won’t do anything to help you!
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