If possible, verify the geographical location of the forex broker.  The financial industry is relatively unregulated in certain parts of the world, so avoid committing your money and personal details unless you’re absolutely convinced it is safe to do so.

By the way… even Swiss brokers should be closely scrutinized.

One good indication of reliability is if government regulations require the brokers to segregate all customer funds from the operational funds of the business.  Your money would be put in highly-reputable banks and the funds only withdrawn upon specific withdrawal requests.

Buyer beware… it’s relatively easy to create a fake regulatory body using cyber-space techniques.  Look at how easy it is to phish unsuspecting buyers using e-mail ploys.

Common sense is not necessarily common… so be extra careful of the following:

• It seems to good to be true
• Claims to predict or guarantee large profits
• The vendor downplays the investment risks
• Claims to trade in the “Interbank Market”
• Obvious targeting to various ethnic markets

Even in the United States you must be careful because despite the appearance of regulatory protection… there is considerable manipulation of the trading markets… especially those sanctioned by the Commodity Futures Trading Commission.

In the U.S. we like to think our government agencies watch over us to prevent entities like unscrupulous forex brokers from taking advantage of us.

Nope… doesn’t work like that.  In fact, the very agencies who are supposed to be protecting us are themselves equally unscrupulous. 

This is especially true of the Commodity Futures Trading Commission (CFTC).  These guys and gals have been screwing around with violations for years and no one seems to give a rip.

Which means… you better be careful before you commit any of your hard earned moola to a forex broker.  Do a background check… pick up the phone and speak with them personally… check out some forums for good and bad comments.

There are some reliable and trustworthy forex trading systems manned by ethical brokers.  Just be careful… because taking legal action against them could be difficult.