Authorities have had a hard time believing that the preacher alone prepared such sophisticated materials for his Ponzi scam. Leave a Reply Cancel reply Your email address will not be published. Fake, unregulated brokers can lure traders in with promises of high and even guaranteed profits, zero spreads, or other unrealistic offers. The forex variety is widespread these days. Avoid any company that predicts or guarantees large profits with little or no financial risk.
The spot forex market trades $ trillion a day, according to the Bank of International Settlements’ Triennial Survey. Combine that with currency options and futures contracts, and the amount traded on any given day is more than $5 trillion.
HYIP’s are just scam
Fundraising began in earnest in Their plan was so safe that there was no risk of loss of principal, and withdrawal requests would be handled promptly at all times. Many duped investors put their life savings into supposedly segregated accounts, but funds were commingled and distributed to a series of shell corporations.
Most modern crooks eliminate this activity. The whereabouts of the remaining funds have yet to be determined. Authorities have had a hard time believing that the preacher alone prepared such sophisticated materials for his Ponzi scam. Many individuals were persuaded to take out loans on their homes and now face foreclosure. The lesson is simple: Beware of ridiculous returns that are presented to you by someone of trust in your community.
Since he came from law enforcement, he was smart enough to keep his fundraising tactics to a modest scale to avoid early detection. Hawkins soon got cold feet, as his actual returns went south. Once again, whom can you trust? If not law enforcement, then whom? If a man of the cloth or of the law cannot be trusted, then what about an ex-serviceman? Once again, the affinity angle was used to gain trust at the front end of the bilking process.
He claimed to have been a former naval aviator with combat experience to gain trust, but officials have found no record of his service. Beware of ex-servicemen bearing gifts. Ponzi schemes are alive and well in America, especially in the field of foreign exchange, and these examples are, perhaps, only a handful of the ones that have gone undetected.
You can be assured that there are many more operating, perhaps, even in your own community. The amounts that we have witnessed in these three examples may seem modest when compared to the Trevor Cook caper, but this lower-amount profile might be disguising a much broader phenomenon. Authorities will be sorting through the rubble for decades before any reparations are made. After fines and court costs, investors rarely see as much as 20 cents on the dollar, but hope does spring eternal.
A popular modern-day scam is the signal seller. Signal sellers are retail firms, pooled asset managers, managed account companies or individual traders that offer a system — for a daily, weekly or monthly fee — that claims to identify favorable times to buy or sell a currency pair, based on professional recommendations that will make anyone wealthy. All the unsuspecting trader has to do is hand over X amount of dollars for the privilege of trade recommendations.
Many of these scammers simply collect money from a certain number of traders and disappear. Some will recommend a good trade now and then, to allow the signal money to perpetuate. This new scam is slowly becoming a wider problem. A persistent scam, old and new, presents itself in some types of forex-developed trading systems. If the parameters and optimization codes are invalid, the system will generate random buy and sell signals.
This will cause unsuspecting traders to do nothing more than gamble. Traditionally, many trading systems have been quite costly. This can be viewed as a scam in itself. No trader should pay more than a few hundred dollars for a proper system today. Be especially careful of system sellers who offer programs at exorbitant prices justified by a guarantee of phenomenal results. Another persistent problem is the commingling of funds. Without a record of segregated accounts, individuals cannot track the exact performance of their investments.
Example #1: January 2014 – Pastor Affinity Fraud
The Trevor Cook playbook for successful forex Ponzi schemes. The best “How To” book award for foreign exchange frauds is generally given to Trevor Cook, a self-proclaimed investment mogul who now sits behind bars, serving out a year sentence. He and his associates stole $ million from over a thousand investors. In fact, the defendant operated an investment fraud scheme. The defendant and others working at his direction raised approximately $29,, from victim investors, but the defendant used only a small percentage of those funds for forex trading (approximately $ million), the vast majority of which he lost. Investment Schemes, Internet Scams & Consumer Fraud Forex Currency Trading Scams Beware of foreign currency, also known as Forex, trading scams promising returns that are too good to be true.