Warning: Scammers Impersonating Fintech Staff to Defraud Forex Brokers

​The forex market features high risks as well as profit, where a huge sum of money comes and goes quickly. Its tremendous volatility has been attracting not only thousands of investors to flood in, but also numerous scammers.

Over the years, the industry has seen a variety of fraudulent tactics popping up that have left investors on the edge of their seats. And the number of fraud cases targeting retail investors has skyrocketed. Regulatory bodies such as the UK's FCA, Italy's CONSOB and well-known industry media outlets like FX110​ are constantly updating their blacklist, but it was still too hard to cease the infringing acts of fraudsters who are overcome by extreme greed.

Today, scammers are getting more and more aggressive as they begin to reach out to forex brokers.

In the past 3 months, Fazzaco has reported 3 stories relating to scammers impersonating fintech companies or solution providers to defraud brokers, especially small start-ups.

A start-up broker defrauded by fake LaunchFXM staff ​

In June 2021, a scammer impersonated an official customer service representative of the UK CRM provider LaunchFXM on Skype and committed a scam against a start-up broker.

The broker's employee Ocean(a Fazzaco user) told Fazzaco that LaunchFXM refused to deliver the product after receiving payment.

Initially, Ocean was intended to purchase a CRM solution from LaunchFXM and then added the impersonator (Jeams) on Skype. After quoting the price, Jeams claimed that Ocean was able to enjoy a lower discount if paying via cryptocurrency. Afterwards, Jeams sent a confirmation message from support@launchfxm.com, the official email address of LaunchFXM. After Ocean made the initial payment of $1,499, Jeams refused to send CRM product screenshot and requested full payment. Suspiciously, Ocean consulted the customer service representative at LaunchFXM's official website, but was told that LaunchFXM don't accept any payments via digital currencies.

With the help of Fazzaco, the truth of the case surfaced. LaunchFXM stated that the startup broker was cheated by scammers on Skype rather than its employees, and that no record of emails sent to Ocean could be found in LaunchFXM's mail box.

Imposters masquerading as B2Broker CEO to defraud clients

In mid-September 2021, B2Broker, a liquidity and technology provider of solutions for the forex industry, warned against fraudsters who intended to solicit funds from Facebook users by creating a fake Facebook account using the profile of Arthur Azizov, B2Broker CEO, and selling B2Broker services and products. That's not the first time that the company's CEO was subjected to fake social media accounts. Recently, a similar event has just occurred on Instagram.

Scammers impersonating Brokeree Solutions to defraud brokers ​

In late September 2021, Brokeree Solutions, a provider of MT4/MT5 platform servicing and forex solutions, has issued a warning about scammers that used fake Skype accounts to impersonate them with fraudulent intentions towards brokers. Besides, the scammers requested payment in BTC or cash.

As we can see from the 3 cases above, fraudsters are now using a new type of fraud scheme, disguising as fintech companies on the social platforms such as Skype to defraud brokerage firms, especially small start-ups. Additionally, they are able to forge official email addresses.

Currently, deceptive schemes carefully crafted by fraudsters are so fast-changing and increasingly rampant that it is hard for investors and brokers to detect them all. Hence, Fazzaco reminds brokers to keep a beady eye and stay alert when looking for a third-party fintech company. Brokers must choose an authorized platform, visit the official website to learn more about it, confirm the accuracy of the information, and use the officially approved payment channels. Small start-ups, in particular, are more likely to fall into the trap of fraudsters when seeking technical support from fintech companies, as they have not yet established stable and trustworthy partnerships with third-parties and have not gained detailed information of the market.

Fazzaco is proud to announce that we are currently the financial information platform with the largest number of forex companies​ in the industry, totaling 1712. A multitude of eminent companies have claimed/created company pages on Fazzaco. Furthermore, we have been continuously following and updating reports from regulators on unauthorized platforms and fraudulent companies. Brokers and startups can check company information Fazzaco before making transactions, and terminate transactions as soon as you find something suspicious, which can help avoid risks to a great extent.

Also, fintech companies should be on guard against clone firms and fraudsters in the industry, and inform their clients of scams in a timely manner, so as to maintain a good reputation and to jointly establish a safe forex ecosystem.