SotFX: Is it Safe for Trading? The Truth Exposed (2023)
SotFX has kept its website weirdly dark. Different brokers try out different techniques to stand out and it seems SotFX has decided to go with a dark website. While writing my SotFX review, I noticed plenty of signs that suggest this broker is a scam.
For example, the sign up process is quick and easy but it doesn’t let anyone sign up on the website. They didn’t let me access the website so I’ll have to rely on their claims for most of the information.
In the following SotFX review, I have listened out the various qualities of this broker to help you determine whether you can trust them or not:
SotFX License and Regulation
SotFX is based in the Marshall Islands, an offshore region. Offshore regions don’t have financial regulators and have become havens for shady brokers and scams. Without a regulatory authority, brokers based in this region don’t face any consequences of their wrong actions.
So, it’s clear from this evidence that SotFX is an unregulated broker. It doesn’t have a license to operate as a forex broker!
How can you spot a broker who is trying to deceive you?
A broker’s credentials, registration, and job history can be reviewed using BrokerCheck, a free online tool provided by FINRA. Disputes with clients, disciplinary actions, and specific financial and criminal matters on the broker’s record are all covered in the disclosure portion of BrokerCheck.
Be wary of unlicensed and unregulated brokers. These brokers don’t follow the stringent rules and regulations of popular authorities such as the FCA or CySEC. Such brokers can use shady techniques to steal your funds or data and get away scot-free because of their unregulated nature.
Regulatory authorities keep a close watch on licensed brokers so they don’t act against their clients’ interests. In case a broker does act against their clients’ interests, the clients can get insurance compensation from their respective regulator. For example, CySEC offers €20,000 in case the broker files for insolvency. Regulators ensure that the broker keeps their operation funds separate from their clients’ trading funds as well.
Unregulated brokers don’t provide such benefits and that’s why it’s very risky to trade with them. If you want to keep your funds and data safe from fraudsters, it’s best to avoid trading with unregulated brokers.
SotFX Trading Conditions
Checking the trading conditions of a broker can help you a lot in understanding its reliability. I always recommend checking the trading conditions of the broker before signing up with them. It ensures that you don’t sign up with the wrong broker. Let’s see if SotFX’s trading conditions are okay or not:
SotFX falsely claims to offer MT5 on its website. They don’t offer this trading platform, but show an image of the same to imply they do. This is false advertising and is a strong sign that SotFX is a scam.
In terms of trading platforms, Metatrader is always the best. Metatrader 4 and 5 are among the most popular trading platforms in the forex industry because of the vast amount of benefits they offer. MT4 provides you with real-time and historical data, interactive charts, as well as, online quotes to help you make better trading decisions. You don’t get such facilities with other trading platforms.
So, always look for brokers which offer MT4 or MT5.
SotFX doesn’t mention its minimum deposit requirement to its clients. Like most of their trading conditions, they have kept it hidden as well.
Seeing how shady their behaviour has been so far, I can safely say that their minimum deposit requirement wouldn’t be good.
You shouldn’t trust brokers that have high minimum deposit requirements. It’s usually an indication that the broker is a fraudster. Because most regulated brokers keep their minimum deposit limit very low to make them accessible to a wider audience.
Read similar report: Golden Sky Capital
Shady brokers keep their minimum deposit limit high so they can steal a substantial sum of funds right away.
Leverage and Spreads
The broker doesn’t mention the leverage it offers to its clients. Usually when brokers hide their offered leverage, it’s because their offered leverage is horrible and very high.
Brokers that offer very high leverage ratios, such as the one I suspect SotFX offers, are usually scammers. FCA, the financial regulator in the UK, doesn’t allow its brokers to offer more than 1:30 leverage to their customers. They have added this restriction to ensure that clients don’t lose their funds because of recklessly high leverage ratios. A very high leverage ratio can cause you devastating losses.
Shady forex brokers keep their leverage ratios high so they can trap their clients in large piles of debt.
The offered spread on the EUR/USD currency pair is 0.5 pips, which matches the industry standards and is quite competitive. However, a competitive spread isn’t sufficient for me to recommend this broker’s services.
SotFX Payment Methods and Charges
SotFX doesn’t give any information on the payment methods it offers to its clients. This is another sign of them being a scam.
Regulated brokers provide all the necessary information about their accepted payment methods to their clients. That’s because they want to facilitate trust and keep things transparent.
It doesn’t seem like SotFX is aiming to gain its users’ trust.
SotFX has kept all of its fee-related information hidden. This is a common tactic among shady brokers because in most cases, they have very unfair fee-related policies and they don’t want the user to find them out.
By hiding their fee-related information, they can ensure that you wouldn’t find out about them. In case a novice trader signs up there, he or she would have to face unfair fees and charges repeatedly from the broker.
Although there wasn’t any mention of bonuses on SotFX’s website, I can’t say for certain that they don’t offer them.
Moreover, many shady brokers like SotFX use bonuses to lure beginner-level traders to their platform, It wouldn’t surprise me if they started offering bonuses to their clients as well.
It’s common knowledge in the forex industry that you should never trust a broker because of its bonus offers. Remember that the funds you get through a bonus belong to the broker and not you. Moreover, forex bonuses allow the broker to impose hidden restrictions on withdrawal requests so the client can’t get its funds back.
Bonuses are quite popular among forex scammers because they allow them to attract new users. Be wary of brokers who offer a lot of bonuses.
Is SotFX a Scam? Yes!
It’s clear by now that SotFX is a scam. The forex sector has many kinds of scammers. Usually, the scammers in this field focus on attracting new and inexperienced traders to their platforms through fake claims and bonus offers. They get the user to sign up on their platform and accept their fishy terms and conditions. Such brokers hide their unfair conditions in the fine print and people usually ignore them while signing up.
Then, they either use hidden fees or make excuses to take away the deposited funds from their user’s trading accounts. Having a high minimum deposit ensures that they get a substantial amount to steal from every user.
The best way to combat such scams is to do thorough research before signing up on any new broker’s website. You should check the broker’s regulation, license, address, and its reputation online. Some brokers even spend money on fake reviews to create a fake positive reputation on the internet.
SotFX Review: Conclusion
SotFX is a scam trying to hide in plain sight. They have all the signs of being a forex scammer and that’s why I don’t recommend trading with them.
You should go elsewhere and find a regulated broker that offers suitable trading conditions.
Be sure to share this SotFX review with others. The more people know about this scam, the better.
SotFX has all the qualities of a scam. They try to deceive traders into signing up with them so they can trap them. Beware of such shady brokers.
- Lies about offering MT5
- Hides trading conditions
- Hides fee-related information