Forex fraud is when a person or entity tries to defraud by disguising the trading activity from their account in order to make a profit. There are many different types of fraud and each one can be categorized into three main categories: industry, company, and individual.
This blog article covers the three different types of Forex fraud that exist today. The first type is impersonation which includes phishing, spoofing, and identity theft. The second type is front-running which includes market-making and information access. The third type is manipulation where people are trying to manipulate the market by adding false liquidity or creating volatility in an attempt to cause a price movement. Finally, this blog has tips on how you can avoid being caught in these fraudulent schemes.
The Basics of Forex Fraud
The first type of Forex fraud is impersonation. This type of fraud occurs when a person or entity tries to get access to your account and use your money without telling you who they are.
An example of this type of fraud could be someone coming up to you on the street and trying to start a conversation with you. They might say they’re looking for work, offer you free tips, or ask you for a referral.
However, they’re not really working for you—they’re just pretending to be someone else in order to get access to your information and use it as part of their scheme. This leads us right into the next category of Forex fraud: front-running.
Front-running is the second type of Forex fraud that can occur. This occurs when an individual or company tries to manipulate the market by adding fake liquidity or creating volatility in an attempt to cause a price movement without telling you who they are, what their intentions are, or what their goals are.
An example of this type of fraud could be someone using social media accounts like Facebook, Twitter, Instagram etc., which allows them to post things that look like legitimate content but still have some promotional value attached to it for potential customers–for
Three Types of Forex Fraud
There are many different types of Forex fraud but the same three types exist today:
This form of Forex fraud happens when someone tries to trick you into giving them your personal information or credit card information. You won’t be able to prevent this type of fraud since criminals are willing to use all kinds of fake accounts, including social media profiles and email addresses that may not even belong to them. Also, don’t be fooled by emails that claim to be from banks or other financial institutions. They can easily be phished by someone trying to steal your personal information.
Sometimes the scammer will try to get your attention by telling you they have a problem with their account or some other error on their end such as losing funds due to a technical glitch or computer problem. This is often used in conjunction with a tradeshow that is being held at a particular location. The goal is to gain access so they can fix whatever issue they’re having, then sell you something (usually stocks) based on those problems.
Now let’s talk about manipulating the market for a moment because there’s also an element of front-running involved here as well.
Tips on How to Avoid Forex Fraud.
Phishing is when an individual or group tries to trick individuals into giving up confidential information in order to access their personal information.
Front-running is when a person or group wants to manipulate the market by adding false liquidity or creating volatility in an attempt to cause a price movement. This fraud can be avoided by learning how to spot potential front-runners and following these tips on how to avoid the most common types of Forex fraud.