The Role of CFTC in Fighting Off Forex Frauds
Generally, investors are terribly careful whenever considering entrusting money to others especially after what had happened to the victims of Bernard Madoff.
In trading Forex, trying to trade profitably is already full of challenges and traders do not need to deal with fraudulent investment service providers.
There are a lot of Forex service providers who do not care whether their customers succeed in building a solid Forex trading business as long as they can rake in cash. So in order to protect U.S. investors, the Commodities Futures Trading Commission (CFTC) was formed. So what exactly is the agency's role in protecting the interests of traders?
Formed in 1975, the CFTC's stated purpose involves protecting market participants and the general public from fraud, manipulation, and abusive practices in relation to transactions involving commodities, financial futures and options. This includes overseeing the retail Forex market.
According to CFTC's website: Today, the CFTC assures the economic utility of the futures markets by encouraging their competitiveness and efficiency, protecting market participants against fraud, manipulation, and abusive trading practices, and by ensuring the financial integrity of the clearing process. Through effective oversight, the CFTC enables the futures markets to serve the important function of providing a means for price discovery and offsetting price risk.
Since its formation, the CFTC has filed hundreds of enforcement actions against firms, owners and employees for defrauding customers who lost millions of dollars with Forex schemes. Unfortunately, fraud victims rarely recovered the funds they have lost. Thus, the CFTC warns the public to be extremely cautious.
Forex trading presents losses not just gains and when you cannot afford to lose trading Forex, do not put all your money into Forex. Learn to start small but as you advance further, you can continue building your capital. The CFTC, along with its international counterparts try its best to regulate the largest financial market in the wold but of course it is still much better to be your own personal fraud watchdog.
Posted on: 9/16/2016