TBC Defrauded Investor with “High-leverage” Scam

Illegal broker: TBC

Regulatory status: Currently unregulated

Complainant: Ms. Zhang

Cause of complaint: Withdrawal failure

Investors might often heard about high leverage in forex investment, and tempting as the so-called “high leverage with high return” may sound, it often accompanies equally high risks, as theres no such thing as a free lunch. Recently, WikiFX got a report from a victim of such “high-leverage” scam.

Event recap

In late July this year, Ms. Zhang opened an account with forex broker TBC. Tempted by the broker‘s promise of high leverage, Ms. Zhang invested US$ 20,000 for her first deposit, hoping to make a fortune with it. However, her investment turned out unsuccessful as she lost nearly US$ 5,000 within a month. Towards the end of August, Ms. Zhang decided to withdraw her balance, but her application remained “in progress” while her withdrawn balance failed to reach her account. Ms. Zhang tried contacting the customer service and the IB of the broker, but neither of them responded to her request. To date, Ms. Zhang’s balance remains unavailable.

Analysis

Many investors may assume that a higher leverage in forex trading means they can harness a larger amount of capital to make greater profits. However, such mindset is often easily targeted by illegal brokers, who lured gullible investors into their traps with so-called high leverage. A fact easily ignored by investors is that with higher leverage, theres inevitably a greater risk; and in the case of choosing an illegal broker, investors face multiplied risks of losing their money.

Ms. Zhang is apparently a victim of the “high-leverage” scam. TBC claims on its official site that investors can “maximize your capital utilization through an optional 1: unlimited leveraged forex trading”. Yet the main financial regulators around the world such as FCA, ASIC and NFA all have restrictions regarding the leverage provided by forex brokers under their supervision, and no regulator allows forex trading with so-called “1: unlimited leverage”.

Conclusion

TBC is but one example of the illegal brokers who try to deceive investors with their misleading “high-leverage” campaigns online. Investors need to carefully verify credibility of such advertisements and stay alert to slogans such as “ high-leverage”, “low threshold” and “great bonuses”. Always check the brokers profile to make sure its compliance. If you have any doubt about the broker, you can download the WikiFX App to verify its identity.