Has anyone heard of this forerx company? They are located in Malta. They called me offered me to open a live account with zero funds and they would give me $50.00. They have 500:1 and do take US customers. I googled them but could not find out much.
I feel this is a stay away from broker, but would like to have some insite from some of you Pro’s.
Thank you much
Regarding ForexBrokerInc —
On their website, ForexBrokerInc emphasizes segregated customer funds, through an unidentified German bank in Malta. However, they do not mention regulation, or a regulatory agency. This is something you should discuss with a representative of this broker, if you continue to be interested in them.
Two points:
First point: The burden of performing due diligence is on you, the prospective customer. You should thoroughly check out any broker you intend to trade with, whether they are U.S.-based, or offshore. Performing your due diligence can be more difficult in the case of an offshore broker; but, it’s in just such cases that it’s vitally important for you to do it. Start with an internet search. Take notes on what you find, or don’t find. Then, talk to the broker’s rep, to confirm what you’ve found on the internet, and to fill in the blanks where information is missing.
Second point: It would cost you very little to take the plunge with this broker, just to see how they perform — even if you haven’t performed serious due diligence ahead of time. If you open an account with $10, or $100, and they live up to your expectations, then you might feel comfortable funding your account with a larger sum.
If you find some useful information on ForexBrokerInc — and, especially, if you open an account with them and gain some experience that you would like to share — consider sharing it on this thread - http://forums.babypips.com/forex-brokers/36221-going-offshore-escape-cftc.html#post220395
Regarding Malta —
Malta has benefited from what’s called “regulatory arbitrage”. That’s when heavily-regulated activities in one country find a more friendly regulatory environment in another country, and they relocate there. Apparently, a lot of financial services business has moved to Malta for just that reason.
Malta is a member of the European Union — which may, or may not, imply overall financial stability, from your point of view. And Malta regulates financial institutions (including forex) by implementing the E.U.'s MiFID (Markets in Financial Instruments Directive). However, I have not been able to determine whether ForexBrokerInc is regulated, and if so, to what degree.
Here are two articles on forex regulation in Malta (note that Chetcuti Cauchi is a Malta law firm) —
This is the email I got from this broker. I have no idea how they got my home phone number nor my email address. We did talk but I never gave them my email. So this was unsolicited. But I did write them an email in reply to this one asking questions that “BabyPips” asks the brokers in the broker list. They have not responded at all, at this time. Below their letter is mine in response asking some questions.
Dear Mr Weaver,
With reference to our prior conversation, please answer to this email including your new real account number, so we can place $50 bonus credit on the account.
Regards,
Lisa Book
Account Manager
–
[B]Lisa Book[/B]
[B]Account Manager [/B]
[B]
[/B]
[B][B]email: [email protected][/B][/B]
[B][B][B]telephone: [/B][B]+356 3550 0072 [/B][B][B]| USA Toll Free - 347 901 4943[/B][/B][/B][/B]
[B][B][B]
[/B][/B][/B]Hello Lisa,Nice talking with you. I am willing to open a live account but I need some more information about your company first, Thank you.
Which bank do you hold clients funds in. I know its a German bank but which one?
It seems your company is not regulated. Is this true? If it is regulated by whom and how much?
Your documentation states that on certain pairs “stops” and “limits” are not allowed to be used. Is this true? If so which pairs?
How many employees does the company employ?
How many clients does the company hold?
Thank you so much for your assistance in this matter.