When alleged crypto trade order takers reach out to me on social media, I get nervous…

Most of you have likely received invitations to connect with an individual offering to help you get started on investing in foreign exchange and /or cryptocurrency.  My first response to these invitations is, “Who are you?”  My vetting process is admittedly cursory and usually need not go further than the pictures of fast cars and bitcoin images the solicitor flaunts in their background pictures. 

Another red flag are the profile names these individuals may go by.  The monikers these individuals use are more suited for a character from the movie “Avatar.”  And the amount of income they guarantee you will earn should give you great pause.  The five-figure a week or month residuals they promise means that at a minimum you will need six figures in capital yielding at least a single figure yield.

I am not qualified to give investment advice but if you have six-figure capital laying around, even in these volatile times, I am sure there are other wealth protection vehicles that you could invest in with brokers or market makers that are easily vetted.

In my opinion, at a minimum, the solicitors approaching you should be registered with the National Futures Association as either an associated person or an introducing broker.

An “associated person” is an individual who solicits orders, customers or customer funds (or who supervises persons so engaged) on behalf of a futures commission merchant, retail foreign exchange dealer, introducing broker, commodity trading advisor, or commodity pool operator.

An “introducing broker” is an individual or organization that solicits or accepts orders to buy or sell futures contracts, forex, commodity options, or swaps but does not accept money or other assets from customers to support these orders.

Vetting these solicitors could be as easy as making an inquiry with the National Futures Association.  The NFA provides a portal where you can search the solicitor and/or the company they allege to work for.

Vetting solicitors should be an integral part of your homework.  The last thing you need is to be featured on some business news show as the latest victim of a scam.

Alton Drew

18 July 2022

Disclaimer: This blog post should not be construed as legal advice or an agreement to provide legal or political analysis.  To set up a consultation, contact us at altondrew@altondrew.com.

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