Regulated Broker Scams & Recovery
Here at Wealth Recovery Solicitors, we work with clients who have not only lost money through regulated brokers, but through broker scams, too. Our team of legal experts can help with tracing monies lost through trades made by regulated brokers and taking steps to hopefully recover lost funds.
When it comes to making trades and investments, a lot of investors are savvy about the risk that comes with cryptocurrency and other investment forms. As a result, they will likely take extra measures and precautions to protect their funds from scams and hackers and one of the most popular ways in which they do this is by making their trades through the use of a regulated broker.
Regulated brokers are those who are registered under financial regulatory agencies and their activity is often monitored by local regulators. But, using a regulated broker doesn’t always mean that your investments are protected.
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What Is A Regulated Broker?
If you believe you have lost money through a broker, it’s important to first establish whether they were a regulated broker or not. Regulated means that the broker in question is responsible to a body and, typically, brokers in the UK will be regulated by the FCA (Financial Conduct Authority). From the millions of pounds that we so far recovered for clients here at Wealth Recovery Solicitors, we have found that an increasing number of brokers that serviced our clients were regulated by CYSEC, the regulatory body in Cyprus.
Although these clients did lose money through a regulated broker, the good news is that these companies and brokers can be held responsible for wrongdoings and misconduct. With our legal team’s knowledge and experience, we can apply pressure on these regulated brokers to ensure that they comply with the complaints procedure in the right way.
How Do Regulated Brokers Lose Money?
Regulated brokers might be approved and responsible for their trades, but that doesn’t make them reputable. Unreputable brokers will act on their client’s behalf, but instead of making the investments they’ve been instructed to do, they will make their own decisions on what to invest in, in the belief that it will pay off for the client and that they get to keep any extra returns. Often though, this can have the opposite effect and most regulated brokers who choose to go down this path will only end up losing their client’s money.
Another way in which regulated brokers lose money is through simply being new to the trading circuit and, instead of trading using a tested strategy, they will make trades based on their instinct, for example, if a trader feels as though the market will move in one direction or the other. When a new regulated trader enters the market, they often do so when their emotions are running high, meaning that their judgement is often impacted.
Before Using A Regulated Broker
Before you consider using a regulated broker, it’s important to protect yourself from untrustworthy brokers by carrying out some research beforehand.
- Carry out a quick online search of the broker. An online search can provide insights into whether any negative feedback or comments could simply be from a disgruntled trader that’s just had bad luck, or it could indicate something more serious.
- Look for complaints from other traders about not being able to withdraw funds following their trades. If there are, you can either contact the user and ask for more information, or simply steer clear of the regulated broker in question.
- Read through the fine print of all documents when opening a new account. Often, brokers use money incentives to entice new traders, which can then be used against you when you try to withdraw the funds.
- Start with small amounts of money before making any large trades with a new broker. Trade it for a month or so and then make a request to withdraw the funds to see how the broker reacts. If there are any problems, attempt to discuss them with your broker and see how the issue is resolved. If you have any problems, you know to avoid making large investments with the broker in question.
What To Do If You Have Lost Money Through A Regulated Broker
If you believe you’ve lost money through a regulated broker, or through a potential broker scam, then please get in touch with us as soon as possible. There are many occasions where traders put the blame onto brokers for poor results and losses, but sometimes regulated brokers really are at fault.
Our team of legal experts will be able to help identify whether your lost money was through the mistake of a regulated broker or broker scam and then suggest the recommended next steps. We offer free consultations, so get in touch with the team at Wealth Recovery Solicitors today to book an appointment.
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Regulated brokers are liable to work in a way that is set by a regulatory body, whilst non-regulated brokers aren’t required to comply. Regulated brokers must be registered in order to make trades and are authorised by the country where their business originates. Being a registered broker means that they need to fulfil the standards as indicated by the regulatory board.
Although a broker may be regulated by an authorising body, this doesn’t always mean that they are trusted brokers. A lot of our clients lose money through regulated brokers making poor investment decisions with their investment funds, however as they answer to a regulatory body, this means that we can hold them responsible for wrongdoings and hopefully recover your lost funds. If your money is lost through an unregulated broker, you may not have the same level of success when it comes to recovering your lost funds.
If you are working with a regulated broker and you suspect that they have been using your money for their own investments, or you suspect they have lost your funds, then there are a couple of things that you can do. Options can be limited, but first, have a read through any and all documentation that may have been sent over during your dealings with the broker.
This can help to highlight whether or not the regulated broker is in the wrong. Alternatively, you can contact us for a free consultation where we can have a look through this documentation and give you a better idea of what might have happened. Then, if the regulated broker is at fault and you’re happy to go ahead with the proceedings of recovering your money, we can contact them on your behalf.
Traders are becoming increasingly targeted by unauthorised forex traders and broker firms who are offering high returns and guaranteed profits under the guise of being a legitimate, regulated broker. These traders offer trades through a managed account where they make trades on behalf of the investor and, initially, traders report that they have received some returns, which gives the impression that their trades have been successful.
However, they are then encouraged to invest further money but it is at this stage, or very soon after, that the returns stop and all contact is stopped. This is a broker scam. If you’re contacted out of the blue by a broker, are made the promise of easy profit returns or everything sounds too good to be true, then this could be the sign of a broker scam and you should avoid investing your money.
Over the 18 months, at Wealth Recovery Solicitors we have recovered just shy of £4 million for clients from brokers using our legal expertise and knowledge. Sometimes, an individual can try and get the money back themselves, but if you’re not prepared with the right arguments and admit to doing certain things during the process, then the broker can rely on this and try and get out of giving any compensation – you only get one shot when it comes to broker recovery!
Here at WRS, we don’t simply try and sue the bank or broker whilst hoping for the best. We are tactical and know exactly how to prepare and build the best argument for our clients. If you believe you have lost money to a regulated broker or broker scam, then please get in touch.