Commission Warning Investors About Increase in Forex-related Scams

The Nova Scotia Securities Commission is alerting Nova Scotians that they are seeing an increase in Forex-related scams targeting investors.

Forex investing includes speculating on the change in value of one currency against another and is legal and regulated in the province if done through licensed dealers in Nova Scotia.

However, its complexity and volatility can be used by fraudsters to mislead unsuspecting investors into believing a scheme is a legitimate and lucrative investment.

Some of the warning signs that a Forex investment may be fraudulent include:

• a guarantee of little or no risk, and high investment returns
• dealers or brokers who are not registered with a provincial or territorial securities commission, and based outside of Canada where it can be difficult or impossible to retrieve funds
• an unwillingness to discuss the past performance or track record of the specialist traders who will handle their money
• an unwillingness to identify specialist traders or traders located in offshore jurisdictions who will handle their money; and/ or
• high-pressure sales techniques to buy a Forex investment, to purchase software or take courses related to Forex trading

Quotes:

“The commission and other provincial and territorial securities regulators in Canada have seen a rapid increase in Forex-related scams online in the past few months. The Commission issued our latest alert about a Forex-related scam just last week. The scams are being offered on social media, online forums and sites like Reddit and Kijiji, targeting investors with promises of high returns. If you do invest in Forex, you need to know that it is a complex, volatile and extremely risky investment. Do not invest more than you can afford to lose.”

– Stephanie Atkinson, acting director of enforcement, Nova Scotia Securities Commission

Quick Facts:

• any firm offering Forex trading to Nova Scotians must be registered with the commission and be a member of the Investment Industry Regulatory Organization of Canada

Additional Resources:

File a complaint or report a scam to the Nova Scotia Securities Commission: https://nssc.novascotia.ca/recognize-and-report-scam

To see if a company or person is registered, visit: https://www.securities-administrators.ca/nrs/nrsearchprep.aspx

Learn more about Forex investing and how to recognize Forex scams: https://nssc.novascotia.ca/before-you-invest/what-are-forex-scams