Aggregated News From Investment Management Regulators

Companies that sell trading and training software

Report/Flag

Please complete the required fields.



The FSMA has noted that various companies in Belgium are selling, via a pyramid structure, trading and training software intended for trading principally in forex, CFDs and cryptocurrencies.

The sale of such trading and training software mostly takes place via a pyramid structure. The term generally used for this technique is ‘MLM’ (multi-level marketing), in which consumers are given incentives to bring in new members. In exchange for doing so, they receive compensation in the form of a commission or discount on the price of the software package or subscription price.

The FSMA has observed that such MLM networks are very active on social media via numerous (private) groups whose only purpose is to promote a particular MLM and to recruit new members. It is worth noting that these schemes mainly target a young audience, who are very active on social media, where all sorts of photos circulate showing young people seemingly swimming in riches. The message is that everyone can afford this kind of lifestyle if they bring in enough new members and make the right investment in the software being promoted.

The FSMA draws attention to the fact that the investments accessible via the software are often not subject to financial supervision (alternative investments such as precious metals or virtual money) or their distribution in Belgium is prohibited (certain derivative instruments such as forex, CFDs and binary options).

Moreover, offers of CFDs and forex via the internet are very risky and vulnerable to fraud: anyone who invests in CFDs or forex runs the risk of losing all the money invested. The possibility of loss is much higher than the possibility of gain: surveys by other European supervisors conducted among investors show that as much as 75% to 89% of investments in derivative products, such as forex products, are loss-making! These products are suited only to someone who really wishes to speculate, is prepared to lose the entire amount invested or even more, and is familiar with derivative financial products. A great many cases of fraud have also been found to use these instruments. In some cases, we have seen that no actual transactions were carried out by the offeror.

Have you received an offer of an investment and would you like to find out whether it could be fraudulent? If so, take the test under the heading ‘Beware of fraud’.

We urge investors always to find out whether the company making the offer has the requisite authorization. A simple search via the search function on the website of the FSMA is all you need. You can also contact the FSMA directly via the consumer contact form.

Source link

Regulator Information

Abbreviation: FSMA
Jurisdiction: Belgium

Recent Articles

The AMF presents an initial overview of SFTR reporting data

Based on the recommendations of the Financial Stability Board, the European Securities Financing Transactions Regulation (SFTR), enacted in November 2015, has made it possible to establish greater tr

SEC Issues Whistleblower Awards Totaling Nearly $5.3 Million

The Securities and Exchange Commission today announced awards of nearly $5.3 million to whistleblowers who provided information and assistance in separate enforcement proceedings.

HQ Trade

We believe this firm may be providing financial services or products in the UK without our authorisation. Find out why you should be wary...

searchinvestments-uk.com

We believe this firm may be providing financial services or products in the UK without our authorisation. Find out why you should be wary...

highestfixedrates.com

We believe this firm may be providing financial services or products in the UK without our authorisation. Find out why you should be wary...

Get the latest from Regulatory.News in your inbox!

×