Clients of Forex Trend Ltd, the retail Forex broker that was earlier this month deregistered from New Zealand’s Financial Services Providers (FSP) list due to regulatory concerns, have been most active in contacting the Financial Dispute Resolution (FDR) scheme during the first year of its operations.
According to the latest Newsletter by New Zealand’s investors compensation scheme, during the 11 months to May 31, 2015, FDR has received a total of 423 complaints against its members.
Out of these 423 complaints, the vast majority – 248 complaints, or 60%, came from clients of Forex Trend Ltd.
All of these complaints were filed by Ukrainian residents, the Newsletter says. For that matter, we should note that Forex Trend claimed to have numerous representative offices in Ukraine, including one in the country’s capital Kiev.
All of the complaints against Forex Trend concerned issues with withdrawing funds, the FDR adds.
What happens next?
First the member (that is Forex Trend) will have the time to make its decision about the complaints against it. In the absence of such a decision, the FDR will take over and issue a summary decision.
According to FDR’s register, Forex Trend is its member and is listed as an overseas entity.
Commenting on the results of its activity for the first 11 months of operation (the 11 months to the end of May 2015), FDR stresses that the biggest proportion of the complaints received concerns Forex platforms. The case of BlackfortFX (not a member of the scheme) is also mentioned with regard to risks associated with online trading.
The underlying message to consumers is of caution when considering trading forex and other commodities online. The risks are high enough, let alone entering blindly into agreements, especially before establishing bona fides of the providers.
Complaints according to provider type
To view the FDR’s latest Newsletter, click here.