The term “due diligence” gets thrown around a lot in our industry and in others for that matter, but the nuances of the craft can save you from becoming a victim at the hands of a clever fraudster. Today’s scam artist is armed with the knowledge of the Internet and a variety of cute tricks that any normal human being or even a regulator could pass over without a second thought. Whereas applying due diligence might have meant using reasonable steps to protect yourself from fraud, you might now need to go deeper.
Faking credentials and pumping up reviews on credible websites has become an art form of late. If you step back for a moment and try to think like your crooked adversary, your first task would be to establish trust and respect with your intended “mark”, before you ever try to “set the hook” for later. There are actually a number of dodgy forex brokers out there that never bother, choosing to go with a “skeleton” website with no transparency with regards to credentials. Let’s assume for the moment that you would naturally steer clear of any broker that withheld such important information.
What then are the normal items that we would include in confirmation of “credentials? Here is a brief list to consider:
In each of these cases, a quick check with your local regulator should help you determine if your potential forex broker is legit or listed on an authorized list or blacklisted due to complaints. In any event, insert each item into a search engine to verify authenticity. Scammers typically focus on lazy, greedy types that prefer to get rich quick by taking shortcuts. Take the time to validate what may appear to be legitimate.
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