Before we start this USGFX review, here’s something weird you should know:
In midyear 2017, something bizarre in the world of FX trading happened in the USGFX offices in Shanghai. Dozens of men stormed the Union Standard International Group Pty Ltd (USGFX) offices and sealed every exit.
Twenty terrified Chinese employees of the Australian foreign currency trading company had their phones seized, signaling the beginning of a hostage situation.
The incident was said to be an extortion attempt. Eventually, it was clear that there was a standoff between USGFX and its customers over massive trading losses.
One of USGFX’s employees was at the center of the dispute that had been building up in China according to statements on the firm’s WeChat account.
The unidentified men holding the employees’ hostage gave them food and water for sustenance and later released 17 of the employees in the first 24 hours of the ordeal.
The remaining three USGFX employees were held captive for five days. The USGFX spokesperson at the time said that the incident was unique to the business in their 11 years of trading around the world.
USGFX review: So, what exactly is USGFX and why should you be afraid?
USGFX is an Australian forex broker. It provides FX, CFD, and indices trading. Users can open, monitor and close trades on MT4 and MT5.
Don’t fall for all the marketing ploys you see on its site.
There have been massive complaints against USGFX from traders, prompting recent ASIC action. If you have fallen prey to this firm’s illegal dealings, seek book a free consultation to learn how to get your money back stress-free.
If you’re thinking of putting money here, don’t! It’s not safe. Let’s talk more about this…
USGFX fraud led to their employees’ hostage event
Back to the story we were talking about in the intro.
Multiple negotiation attempts later, they let go of the employees.
Chinese USGFX investors say that they lost over $2.6 million in forex trades to the firm. They had, therefore, held the employees hostage for compensation.
In China, taking hostages in cases of financial disputes is often a more preferred route than civil lawsuits. Reports show that courts are usually very sympathetic to this type of hostage-taking classing as “unlawful detention.”
The Chinese consider situations such as that of the USGFX hostage debacle a minor offense, which is why the security forces did not intervene.
There were no SWAT vans at the office. No local media-frenzied interest at the ongoings. The government did not do much about it. Media reports show that there was a minimal police presence in the hostage location and perhaps one visit from the local economic crimes unit.
USGFX not a stranger to massive investor fund losses
The hostage situation would have passed as a blip in the life of USGFX. However, this trader’s stormy relationship did not end with its Chinese traders.
On December 23, 2019, the Australian Securities and Investments Commission (ASIC) issued an interim restraining order on USGFX assets. The broker has since then been under ASIC investigations.
The asset restraining order affected two other firms related to USGFX; EuropeFX and TradeFred.
These two companies had been trading as Maxi EFX Global AU Pty Ltd and BrightAU Capital Pty Ltd, respectively. The ASIC sought customer protection under the Corporations Act section 1323 as it set on its investigation on USGFX.
As detailed on our comprehensive EuropeFX review and USGFX scam alert, ASIC shut down Europe FX. Pedro Eduardo Sasso, the EuropeFX director, was placed under a no travel ban and received a criminal charges court order.
All his clients at EuropeFX were moved to USGFX. We also notified FX traders that Sasso’s EuropeFX was an apparent scam hiding behind a USGFX trading license.
This situation implies that any misdemeanor at Europe FX happened under the full approval and accommodation of USGFX. There is no other reason why USGFX would risk its valuable trading license’s reputation over Sasso’s financial crimes.
We recommended that besides exiting Europe FX, traders should also move their funds from USGFX before it collapses as well.
ASIC vs. USGFX
The mere action of censuring USGFX should be warning that there is a big problem with the trading firm. The fact that USGFX allowed a rogue trader to deal under its license is a second red flag. The massive numbers of complaints against the broker are worrying.
ASIC got over 85 complaints by investors against the broker before springing into action.
The December 2019 court orders were applied to the USGFX Corporate Authorized Representatives. The asset restrains order against USGFX assets was, however, later vacated. In its place, USGFX said that it would maintain cash reserves of 182,000 Australian dollars and $53,067 in separate bank accounts.
The courts, however, slapped John Carlton Martin, the USGFX, and TradeFred with an order that he should avoid overseas travel. If he had to, he would need to inform the ASIC first.
Trading with USGFX is very risky
Union Standard International Group Pty Ltd is one of the oldest FX trading firms in Australia. It has offices in Sydney, Shanghai, Hong Kong, and Auckland.
It has nevertheless tarnished its decade long reputation building exercise with series of complaints from customers that have brought it under ASIC radar.
The vacation of the asset restraining order emboldened the USGFX officials, who later claimed that the judge overseeing the hearings was critical of the ASIC application. They have therefore said that the ASIC was turning draconian.
The truth is ASIC has always been very astute, especially with its First Derivatives surveillance system, a high tech real-time monitoring platform on the Australian brokerage sector.
The systems give ASIC a thorough understanding of the industry. ASIC has done a study that revealed that 80% of traders in binary options and 72% of CFD traders lost money in 2018. The regulator estimates losses of over $2 billion in that one year.
It’s not just about losses being part of the trade
USGFX can argue that losses are a big part of day trading, and most investors lose their capital due to greed and lack of trading knowledge. There are, however, other conflicting factors that make the events at USGFX black swans of an impending loss of investor capital.
- This broker has exceptionally high negative reviews. Not forgetting the ASIC censorship. This means that a majorly of the traders at USGFX are losing money in suspicious ways.
- Its association with Europe FX, an entity shut down by the ASIC, makes USGFX a probable accessory to the irregularities at Europe FX
- The business representatives in Taiwan have also been accused of displaying faked Commonwealth Bank affiliations to their clientele
- iSignthis, a company that has facilitated the loss of over $100 million on behalf of banned OT Capital, has also been linked to USGFX. iSignthis has, however, denied any link to the trading firm.
If you have your money invested in USGFX, take quick action, and secure it by moving it out of the firm’s clutches. The USGFX red flags are too many to ignore. Should you require assistance on the recovery of your capital, schedule a free booking now, and get on the road to recovery.