Traders can protect themselves from scam trading platforms by conducting an in-depth review of the platform before depositing funds. The growth of online trading has led to the proliferation of fraudulent brokers using fake company names and conducting fraudulent activities. Researching a trading platform and reading user reviews and feedback is one of the best ways to determine its reliability.
Let’s take a deep drive into the LondonFX trading platform to find out why users were dissatisfied with its services and features, and many referred to it as a scam on social media platforms and online forums.
What is LondonFX?
LondonFX claims to provide services related to foreign exchange trading, including consultancy services. Moreover, it says institutional investors like foreign exchange banks around the world utilize its services. On top of trading practices, LondonFX mentioned on its website that they are also engaged in designing and management of trading systems as well as e-commerce initiatives.
However, if you visit their website, you will be surprised to see that the design, tabs, and other features are of low quality. In fact the URL also looks suspicious and unsecured.
Regulatory Status of LondonFX
Trading services of unlicensed brokers have never been considered reliable. This is because you cannot get your money back once you are scammed. Additionally, you cannot complain about it to anyone. So, always put your money with legit FX trading brokers that are regulated by FCA, CySEC, and other authorities. In Australia, its Australian Securities and Investments Commission (ASIC).
In the case of LondonFX, it appears that the platform is not registered. They only mention that they are registered in England and Wales. No details have been provided regarding their legal status.
LondonFX does not mention anything about account types on its platform. The traders are required to contact the support service to find out about account types and deposit requirements. Below are the account types they offer to investors:
- Classic MT4 Account: For this account, the minimum deposit requirement is $1,000 with the minimum lot size is 0.01 and maximum leverage of 100:1.
- Pro MT4 Account:The second account LondonFX offers is the Pro MT4 account and traders are required to make a minimum deposit of $3,000 to open this account. For this account, the minimum lot size is 0.01 with a maximum leverage of 100:1.
- Pro ECN Account: The platform has set the minimum deposit requirement of $1,000 for Pro ECN Account. In this account, the variable spread is offered to traders from 0 pips.
MT4 is alleged to exist, but there is no real proof that it does. As we were unable to create an account, we have no way of knowing for sure if the broker actually provides its users with an MT4 platform. Whether a web trader is available is unclear. However, we recommend against investing here.
No Demo Account
LondonFX does not offer an opportunity to review or test its platform before depositing funds. The demo account is not offered on LondonFX. The demo account is significantly important for brokers and traders. This is because traders usually test the platform through demo trading to see whether their trading strategies work well on software. Demo accounts are usually offered by legit brokers to prove that their trading platform meets the needs of traders.
Deposit and Withdrawal Methods
Deposit and withdrawal requirements are also not mentioned on the LondonFX website. The traders are required to contact the support team to find out about the deposit and withdrawal requirements. The support team member will guide you on how to deposit funds, which appears like a suspicious activity.
On the other hand, legit brokers clearly mention their deposit and withdrawal policies. Also, legit brokers never hold traders’ funds in their business accounts. These brokers hold users’ funds in a separate account and return those funds immediately on demand to comply with regulators’ policies.
LondonFX Works like an Online Scam Platform
Unlike the most prevalent online trading scams that initially display profitable trades that give the investor a false sense of confidence, LondonFX works differently to trap traders. They don’t promise large returns but they try to convince traders that they are one of the best and large trading platforms. To gain more traders’ confidence, they show that trading services are only part of their business model and that their activities include e-commerce and development.
LondonFX, like many other fraudulent companies, claim they are located in a jurisdiction that is regulated and displays fake license numbers and addresses on their websites to make themselves seem credible to unsuspecting investors.
Avoid Scams and Trade with eToro
With millions of users worldwide, eToro is clearly a platform where traders can feel secure. The UK-based trading platform has more than 20 million users in approximately 100 countries, including millions in 43 U.S. states.
eToro is authorized by regulators such as the Australian Securities & Exchange Commission (ASIC) and the Financial Conduct Authority (FCA).
Client funds are kept at tier 1 banks, and client information is encrypted by SSL. EToro gives you complete control over your account settings. Your data won’t be shared or spammed without the traders’ permission.
eToro is the pioneer of social and copy trading. The company offers investors the ability to copy the trades of advanced investors. This is one of the best features of eToro for new investors who don’t have enough experience to use their own trading strategies.
The platform is also user-friendly and easy to use. The user can easily create watchlists, add instruments, and place a trade directly from each watchlist. The platform works well both on the web and mobile. Furthermore, there is no time limit on eToro’s $100,000 demo account. Deposit fees are not charged. Most brokers do not charge deposit fees. EToro charges $5 for bank transfers, in line with industry standards.
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