Scammer Alert – Trader Feedback Suggests 500investments is a Scam Broker

The Forex Fraud team are constantly reacting to feedback from members of the trading community and need to share that we have recently seen an uptick in the number of adverse reports relating to 500investments. One of the most worrying signs for anyone who has money placed with 500investments.net or 500investments.com is that the site is currently not contactable.

There are many tell-tale signs that a broker might not be legit, and one is that the site is down. Another signpost is the opinions of regulators. To add to the misery of anyone with money at stake, the FCA (Financial Conduct Authority) has released a cautionary note that “500 Investments/ Cabsy Holdings Ltd … may be providing financial services or products in the UK without our authorisation.”

Source: FCA

Direct feedback from members of the trading communities includes this update from a US-based trader who contacted us to say:

“500investments is a scam broker. Their website looks professional, but they scam their clients for their money. They make unauthorised trades on behalf of their clients, then manipulate the trading rates. Then the clients lose their money. This normally happens as soon as the clients ask for a Withdrawal.”

While the Forex Fraud team are working with those contacting the site to gain more colour on the situation, it would seem that 500investments don’t pass the “sniff test”. There are also reports of the “double-dip” where the platform’s support team advise that account holders are required to send more funds to their account to have their initial outlay returned; that is a well-known red flag. Forex Fraud analysts can’t recall any instances of this scenario ending well.

Making money from trading is hard enough without giving it away to a scam broker. If something looks too good to be true, then, unfortunately, it usually is. This is a good time to remember that setting up with a regulated broker, ideally licensed by a tier-1 regulator such as those in the list below, is essential.

• The Financial Conduct Authority (FCA)
• The Australian Securities and Investments Commission (ASIC)
• The U.S. Securities and Exchange Commission (SEC)
• Cyprus Securities and Exchange Commission (CySEC)

If you are looking to trade with a reputable broker, please visit the Forex Fraud short-list of trusted brokers. Alternatively, the Broker Review section of our site gives a breakdown of the pros and cons of different brokers – but we only carry out reviews on brokers we rate ‘legit’. If you get the basics right and choose a safe broker, you can then fine-tune your selection by trying out a free Demo account and by doing that, you can test the functionality of the site hands-on.

Crowdsourcing information about scam brokers can help others avoid falling into the traps set by disreputable brokers. You can share your experiences here. If you want to know more about this topic or have been scammed by a fraudulent broker, you can also contact us at [email protected]

About the author: Justin Freeman

Justin is an active trader with more than 20-years’ industry experience of working for big banks and hedge funds. He has an inside knowledge of how the financial markets work, thanks to roles including trader on a $750m Event-Arbitrage desk and CRO and COO of hedge funds running a variety of strategies. From stat-arb and trend-following CTA to fixed-income relative value. Firm’s he has worked at include big banks like Citi, and prominent hedge funds including D. E. Shaw and Millennium Capital Management.

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