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Binary Trading Scandals and Scams

When dealing with Binary trade, there are numerous risks involved, and if these risks are overlooked, there is a high probability that scandals will erupt from time to time. The only way to evade these scandals is by ensuring that every binary trader avoids making certain mistakes some of which are explained below:

Downplaying the Risk Involved in Binary Trading

Binary traders often use to tricky methods to ensure that they lure their customers into depositing their money. Mostly, it is an outright fraud, and they succeed only because they target uninformed customers. They make false assurances to the client claiming that the returns will be great but they are just false promises. There is one particular scam that involved a broker by the name Guralnek who was told to introduce himself as a broker who had made commission through binary trade and also emphasizes on how much money one can make. His true interest, however, was that the client makes the wrong prediction and lose their cash.

Cold Calling

The binary traders tend to force themselves into the lives of their potential clients. They just dial anonymous numbers, and after receiving their call, they do not only suggest but also insist on an amazing investment deal. The broker tells you their “business” name and pleads with you to invest a certain amount of cash with the promise of huge returns. Their words are very appealing and attractive, and most of the times the uninformed clients will accept the deal without giving it a second thought.
This should be alarming to the client since a binary broker should not have a client’s number without the client’s authorization. In this perspective, cold calling refers to a situation whereby the broker purchases the contacts and personal information of their potential client which is mostly from leaked databases which are illegal.

Unclear Terms and Conditions

When dealing with binary trade, the terms and conditions of the pre-agreement should be precise and clear. Brokers will often hide parts of their firm’s terms and conditions and only present the favorable parts to the clients. The unclear or hidden terms mostly rotate around bonuses and withdrawals whereby a client may fail to access their bonuses or withdrawals in regards to certain terms and conditions which were not known to them during investment.

Managed Accounts

It is not ethical for brokers to offer their clients managed accounts. A broker managing their client’s money can easily mislead the client with the aim of amassing money for themselves. To make maximum profits, a broker needs to entice many clients and huge investments since they are mostly paid via commission. In case they get a chance to manage an account, they will manipulate the account owner to ensure that maximum investment will be made which will be to their benefit. Each successful trade means that the broker will make less money, so the main aim of the brokers is to make the client’s trade unsuccessful.

Refusing to Process Withdrawal

Withdrawal from a binary trading firm is always accompanied by unimaginable paper work aimed at frustrating the client and slowing the withdrawal process. This is often the last process towards ensuring that the firm retains the client money. When a client insists on getting their money back, the broker may be advised to ignore their call, and since the client doesn’t know their real address, the money is lost.
There are several ways through which people can lose their funds to fraudulent and unethical brokers. These scams can be avoided if traders act in line to their diligence. If brokers opt for legitimate services, binary trade can help make the world a better place. To ensure that the binary trade runs smoothly and is beneficial to all players, the brokers and clients should avoid making the following mistakes: Downplaying the risk involved with Binary trading, cold calling, hiding or giving unclear terms and conditions, managing or accepting their accounts to be managed and finally the brokers and the entire firm should not deny the clients an opportunity to withdraw their funds. If these aspects are put into consideration, the binary trading industry will be successful and will even be made legal in more countries thus attracting many customers.
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