Foreign exchange fraud

Foreign exchange fraud is any trading scheme used to defraud traders by convincing them that they can expect to gain a high profit by trading in the foreign exchange market. Currency trading became a common form of fraud in early 2008, according to Michael Dunn of the U.S. Commodity Futures Trading Commission.^[1]

The foreign exchange market is at best a zero-sum game,^[2] meaning that whatever one trader gains, another loses. However, brokerage commissions and other transaction costs are subtracted from the results of all traders, making foreign exchange a negative-sum game.

^ Lindsay, Daniel (2014-01-20). "Regulatory Holes Provide A Playground For Forex Fraudsters". mahifx.com. Archived from the original on 2014-02-03. Retrieved 2014-01-28.
^ Douch, Nick (1989). The Economics of Foreign Exchange. Greenwood Press. pp. 87–90. ISBN 978-0-89930-499-1.

[WSJ3-1] Lindsay, Daniel (2014-01-20). "Regulatory Holes Provide A Playground For Forex Fraudsters". mahifx.com. Archived from the original on 2014-02-03. Retrieved 2014-01-28.

[ND-2] Douch, Nick (1989). The Economics of Foreign Exchange. Greenwood Press. pp. 87–90. ISBN 978-0-89930-499-1.

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