The forex market is the largest financial market globally, dwarfing the frenetic and famous stock market by the trillions.
Data by the International Bank of Settlements shows that the daily FX trading volumes were up by $6.6 trillion by April 2019.
The foreign exchange market attracts massive numbers of traders because the barriers of entry to trade are low. Consequently, the industry is synonymous with loss of cash.
Data shows that 96% of all day traders in forex trading lose their hard-earned capital and eventually quit the market.
Sadly, many people also lose money to scammers. Schedule a free consultation with experts if you want to recover any money you lost to a scam forex broker.
Here, we give you reliable data on the Xtrade scam. Let’s go.
Xtrade Review: What exactly is it?
Xtrade is a forex and contracts for difference (CFD) broker whose parent company is XFR Financial Ltd. Its main offices are in Limassol, Cyprus. Like 24Option, it has a Cyprus Securities and Exchange Commission (CySEC) license. This regulates its CFD trading along the major European Economic Area zone.
It operates in other jurisdictions through its International Financial Service Commission in Belize (IFSC) license.
The business is compliant to the Markets in Financial Instruments Directive (MiFID). It has a branch in Italy and Australia, where it operates using its Australian Securities and Investments Commission (ASIC) license.
Beyond its registration and licensing prowess, the firm has also perfected its branding. In 2016, Xtrade partnered with Cristiano Ronaldo, the Portuguese football star.
According to Xtrade’s head of operations, the firm and Ronaldo went into partnership because both share the drive to become the top performers in their respective fields. One of the football star’s fantastic promotional lines for the firm states, “To be the best, you need the best!”
Yes, Xtrade has proper licensing. And yes, Cristiano Ronaldo promotes it. That can easily make you think Xtrade is legit, right? Wrong. Here’s something you should know about scam forex brokers.
Unearthing Forex Trading Scams
Here’s the bad news:
You can cover all the significant risks of FX trading. You can study the minor ones such as psychological, volatility, and credit risks. After all these, you may still find yourself unintentionally exposed to FX trading failure.
Many brokerage firms out there are wolves in sheep’s clothing businesses. These are scammers hiding in plain sight, exposing you to counter-party risk.
A registration license commonly differentiates an untrustworthy trader from one that is not. Regulatory enforcement can protect you and your capital from criminal FX trading activity.
Sadly, there are seemingly legit brokerage firms out there that use their licenses as a guise for misconduct. One of these firms is Xtrade.
Why Xtrade is a wolf in sheep’s clothing
The firm’s outer façade gives the impression that it is a reliable and popular partner in trade. It does not have hidden fees. Its platform is easy to use and robust.
The truth behind Xtrade, however, will become apparent after you have read its user reviews. Here are some of the common complaints:
- Unethical behavior such as opening trading positions without the express permission of the account owner
- Showing traders artificial accounts with made-up figures and bonuses that you cannot withdraw
- Hidden rules that make it impossible for traders to withdraw their cash when they want to
- Continuous loss-making trades that often surpass trading capital invested, meaning that advisors discourage traders from using stopgap measures
- Problems reaching customer support
- Offering financial advice to traders. Their licensing does not cover this. The information often drives newbie traders to make more deposits and incur more losses.
- Their proprietary software has a considerable latency in execution, making it impossible to execute speedy trades when volatility is high
- The latency in execution often results in orders opening late, causing massive losses for traders
- Selective requiting of trades when market prices have changed
- Manipulating spread prices on orders to ensure that traders make less profit than usual
Here’s what one reviewer said in Forex Peace Academy:
The awful truth about Xtrade
Apart from what reviewers say, here are some more damning facts about Xtrade:
- The British Columbia Securities Commission (BCSC) issued warnings against Xtrade and its sister trading company XForex, owned by XFR Financial Ltd. According to the BCSC, XFR Financial Ltd has a CySEC license. This license does not cover the trading activities of XForex and Xtrade. Both brands are, therefore, not allowed to trade in Canada.
- ASIC has been forced to intervene in the operations of Xtrade. ASIC changed Xtrade’s handling of traders’ money. This was after ASIC surveillance showed that the brand’s payment processes were questionable.
- The ASIC additionally noted that Xtrade had placed buffers into the client’s accounts to limit any unexpected shortfalls, which could breach the legislative protections given to traders via licensing.
- Xtrade promises up to $6,000 bonus for first deposits. Scam brokers offer huge bonuses to attract and encourage unfettered trading, high leverage use, and false confidence, leading to enormous losses.
Xtrade scam: The final word
Xtrade is the typical example of a wolf in sheep’s skin. Here’s why:
Xtrade’s parent company XFR Financial Ltd has a CySEC license, which might fool traders into a false sense of security when dealing with the firm.
The brand is associated with XForex, a non-regulated brokerage firm. There is a multitude of user reviews online that point to excessive unethical trading behaviors that clearly shows that Xtrade is a scam broker.
ASIC and BCSC have flagged Xtrade for its illegal trading practices.
It lures traders into signing up for accounts with promises of big bonuses and support in trading. The broker then takes over the cash, making withdrawals and trade management difficult.
The firm’s “advisors” who are not licensed to offer trading advice will push traders into investing more capital, causing more losses to the traders.
Has Xtrade scammed you? Sorry about that. Here’s the good news. Our expert wealth recovery experts can help you get your money back. Schedule a free consultation with us and get started on the road to recovery.