Online Trading Scam: How to Recognise It and How to Obtain Legal Protection

Have you fallen victim to an online trading scam? Find out what to do immediately, how to report it and how Boccadutri Law Firm can assist you.

Online trading scams all share a common foundation: promises of easy and substantial profits, pressure or deception to induce deposits, and sudden “taxes” to be paid in order to withdraw funds.

If you suspect you may be the victim of a Forex scam, the first step is to stop making any further payments.

Online trading scams involving Forex, cryptocurrencies and “multi-asset” platforms are now widespread and not always easy to recognise.

The primary protection lies in financial awareness, but once the scam has already occurred, it is essential to take legal action as well.

If you have fallen victim to an online trading scam, time is a crucial factor: realising what may have happened and taking action must be immediate steps.

Let us examine how these scams work, which warning signs should alert you and what steps can be taken to try to protect your rights.

Online Trading Scams: Forex and “Multi-Asset” Platforms

Online trading scams, particularly in Forex and multi-asset platforms, use social engineering techniques and misleading marketing to promise easy profits, often manipulating technical data.

Trading scammers use simulated platforms, fake performance reports and fictitious “recovery experts” to misappropriate capital, frequently through spam emails and social media.

What is Forex

Forex, short for “Foreign Exchange”, is the global decentralised market for currency trading, the largest in the world with a daily volume exceeding 7 trillion US dollars.

It is an over-the-counter (OTC) market where banks, companies, governments and private traders buy and sell currency pairs such as EUR/USD or GBP/JPY, speculating on exchange rate fluctuations.

It has no physical location; it operates through electronic networks, with prices determined by supply and demand, and it is open 24 hours a day, five days a week.

What are multi-asset platforms

Multi-asset platforms are trading software or systems that allow users to trade multiple classes of financial instruments simultaneously, such as shares, bonds, forex, commodities and cryptocurrencies, through a single interface.

These platforms integrate access to various global markets, offering traders and investors the opportunity to diversify their transactions without switching between separate applications.

What is an online trading scam and how it works

The greatest risk in trading lies in its extreme ease of access.

Whereas in the past scammers mainly focused on Forex, today the fraudulent scheme has been absorbed into a broader online investment ecosystem that includes:

• cryptocurrency exchanges and crypto trading platforms
• brokers offering Forex, CFDs, options and crypto simultaneously
• apps claiming to use artificial intelligence to generate exceptionally high returns

All it takes is a smartphone and a few hundred euros to start trading currencies, indices, CFDs or cryptocurrencies, often without possessing the expertise such activity requires.

The only certainty is that no form of online investment is 100 percent safe.

Nevertheless, trading scammers promise easy profits within a short time frame.

To persuade you to deposit increasing amounts of money, they simulate investments and profits that are in reality purely virtual.

New deception techniques

• Artificial Intelligence (AI): scammers use AI to create voice or video deepfakes of well-known figures endorsing fake investment platforms to lend them credibility.
• Fake Exchanges and Wallets: through the use of AI, apps and websites are created that perfectly replicate well-known platforms, displaying fictitious profits to push the victim to deposit increasing amounts of money, often by requesting “taxes” or “guarantee funds” to allow withdrawals.
• The “multinationals” of fraud: online scammers have organised themselves into real multinational structures, complete with call centres and technology teams that build complex fraudulent ecosystems, no longer limited to simple websites.

For a single victim, confronting such organised structures without support is almost impossible.

What Online Trading Is Today and Why It Has Become So Risky

Today, online trading is the activity of buying and selling financial instruments in real time, including shares, currencies, cryptocurrencies and derivatives, through digital platforms accessible to anyone via smartphone or computer.

Although it was originally intended to democratise investment, it has become extremely risky due to high market volatility, financial leverage and, above all, the explosion of online scams, which now represent an increasingly significant share of online fraud reported to authorities.

How an online trading scam works

The scammer constructs a psychological trap: they present enormous profits in exchange for small investments and show apparent success to induce you to invest more and more.

The typical scheme works as follows:

• You are contacted by a self-styled adviser or a “new acquaintance” who proposes investment opportunities.
• You are invited to deposit a modest initial amount, which appears to generate extraordinary profits on the platform within a short time.
• You are encouraged to increase the invested capital in order to “meet the standards of top clients” and obtain higher returns.
• When you request a withdrawal, the funds are never actually available, except possibly the first time and only for a small amount.
• To unlock your earnings, you are asked to pay additional sums for alleged taxes or commissions.
• Even after making these payments, you are unable to recover either your profits or your initial capital.

As also clarified by the Postal Police, anyone requesting additional money “under the pretext of unlocking refunds of sums already invested” is committing actual extortion.

Warning signs of a Forex trading scam

It is possible to learn how to recognise a scam in time by paying attention to certain warning signs.

If you are facing a Forex trading scam, certain indicators are recurring and identifiable:

• Unrealistic promises: be wary of anyone promising fixed, rapid, high and risk-free returns. Categorically distrust anyone who guarantees them. In trading, profits are uncertain and involve risks.
• Psychological pressure: there is no genuine urgency to invest. If you are presented with limited-time offers and threatened with missing out, you are not dealing with serious professionals. Scammers often rush investors, exploiting emotions to induce hasty decisions.
• Bonuses: promotional offers tied to restrictive conditions that force you to invest increasing amounts.
• Requests for additional money: demands for further investments to improve your investor status, or for taxes and commissions to withdraw profits.
• Remote access software: invitations to install programs such as AnyDesk or TeamViewer to “assist” you, which in reality allow them to take control of your account.
• Unauthorised platforms: scammers often do not even attempt to appear legitimate. It is therefore possible to verify whether they are authorised to operate. In Italy, the regulatory authority is CONSOB, which allows you to check whether the platform is listed among authorised brokers.
• Registered offices in tax havens or third-party accounts: many fraudulent companies are based in offshore countries or tax havens, making fund recovery difficult. Often, bank accounts are not even registered in the broker’s name.
• Use of well-known testimonials: it is common to see famous faces associated with fraudulent platforms, usually without their knowledge.
• Unexpected contact: phone calls, emails or social media messages from strangers offering unique investment opportunities.
• Lack of transparency: evasive answers, non-existent or vague white papers, legal offices in tax havens and anonymous teams are clear indicators of fraud.

Another indicator is the conduct of fraudulent brokers.

Before victims invest:

• persistent calls, often in aggressive tones, urging them to “take advantage” of limited offers

After victims invest:

• requests for extraordinary taxes or commissions to unlock funds
• veiled threats about alleged tax issues if further payments are not made immediately
• sudden disappearance of the broker, blocked access to the platform or complete silence in response to complaints

If you recognise yourself in one or more of these situations, it is essential not to send any further money and to start gathering evidence immediately.

Always verify CONSOB authorisations.

What to do in case of a suspected online trading scam

As mentioned above, it is important to gather evidence such as chats, emails and transaction records, and to file a complaint in order to initiate fund recovery.

In Italy, the authority responsible for handling reports of online fraud is the Postal Police, which cooperates with law enforcement agencies in other countries to combat cybercrime and seize scammers’ assets.

Filing a complaint is extremely important, as investigations are opened and authorities take action on the basis of formal reports.

Funds and assets seized by law enforcement may form part of a future distribution among victims who have formally reported the scam, as occurs under investor compensation schemes.

Another recommendation is to file a report with CONSOB if the platform offers financial products. This may result in the website being blocked.

Filing a complaint and first practical steps

Below are the essential steps to attempt recovery of funds after a suspected online trading scam:

1.Legal actions and immediate reports

• Report to the Postal Police: this is the first essential step. The procedure can be initiated through the Online Public Security portal.
• Report to CONSOB: inform the authority through the CONSOB portal, which is useful for blocking unauthorised websites and warning other users.
• Contact your bank: report the issue. If you paid by card, request a chargeback. If you used a bank transfer, immediately contact your bank to check whether the transaction can be blocked or recalled.

To maximise your chances of protection:

• Change credentials: update passwords for your digital accounts, including email, social media and online banking, from a secure device.
• Keep bank statements: collect receipts of transfers and transactions to cards or wallets.
• Save emails: preserve messages, screenshots of restricted areas and social media profiles used, in a consistent and dated manner.

Never install remote control software if requested by the broker.

If the scam has caused significant stress, do not hesitate to seek emotional support by speaking with family, friends or a professional.

A lawyer experienced in Forex litigation can assist you in preparing the complaint, identifying responsible parties and assessing possible actions to recover lost sums, where feasible.

Fake debt recovery law firms: the scam within the scam

Unfortunately, those who have already lost money often become targets of a second scam, carried out by the same individuals or their accomplices.

They present themselves as lawyers, bank officials or supervisory authorities, claiming they can recover already “blocked” funds and requesting new payments for expenses, taxes or release fees.

They are often able to provide precise details about the scam suffered, as this knowledge derives from the crime itself.

It is important to remember that legitimate professionals do not operate in this manner: a genuine law firm does not cold-call you promising guaranteed results or demand disproportionate sums simply to “release” funds it claims to have already found.

The same applies to insolvency practitioners tasked with compensating victims: they do not request money.

If someone calls claiming to have “already recovered your money” and asks you to pay to unlock it, you may be facing a second scam.

Pig butchering, social media and dating apps: the tinder scam

A particularly insidious variant is the so-called “Tinder Scam” or “pig butchering”, which exploits social media and dating apps through social engineering techniques.

The scammer pretends to establish a romantic relationship, gains the victim’s trust and only later introduces an investment proposal on Forex or crypto platforms, presenting high profits as a “shared opportunity”.

The scammers’ behaviour depends on their profile: some quickly move to proposing investments after superficial contact, while the most dangerous cultivate the relationship for months, gaining complete trust before introducing the investment.

In many cases, the scammer even appears willing to “lend” part of the capital, which is in fact fictitious. When the victim accepts, they find themselves in debt and under pressure, facing continuous demands for additional payments to avoid supposed retaliation.

Ponzi scheme: the most common scam

The Ponzi Scheme is the most classic and widespread scam.

Returns promised to initial investors are paid using funds from new investors, while scammers use the money for personal expenses. The system collapses when there are insufficient new funds to pay earlier investors.

How to determine whether a trading company is reliable

To reduce the risk of encountering a scam, it is essential to verify that the broker is authorised and does not appear on warning lists issued by supervisory authorities.

You may consult, for example:

• CONSOB and the Bank of Italy, for Italy
• ESMA, for Europe
• CySEC, FCA, SEC and equivalent national authorities

The absence of negative reports is not an absolute guarantee, but it is an important initial filter.

It is also good practice to search for the broker’s name online, read reviews and verify whether complaints or reports have been made by other investors.

How Boccadutri law firm can assist you

If you want to know how to report a trading company, you should rely on a lawyer active in the sector who may attempt to recover the scammed funds.

The more people report the same scam, the easier it becomes to stop scammers and seize their assets.

To understand how to recover money lost in trading, it is first necessary to consider that in some cases filing a complaint is important, but attempting recovery may not be economically worthwhile.

For this reason, a preliminary consultation is useful: it allows you to understand when it makes sense to invest time and money in recovery action and when it is preferable to limit yourself to filing a complaint.

The loss of small amounts may involve legal costs that outweigh the potential benefit, but reporting remains important: write to the Postal Police, share your experience on social media and sector blogs, and help others avoid falling victim to the same scammers.

The Forex Litigation Department of Boccadutri Law Firm has for years assisted clients worldwide who have been victims of Forex, CFD and cryptocurrency scams, also thanks to offices in key jurisdictions such as Cyprus, one of the main hubs for online trading.

Among the activities our lawyers can carry out for you:

• analysis of the case and reconstruction of money flows towards brokers, payment intermediaries and wallets
• communication with authorities, intermediaries and supervisory bodies
• support in criminal complaints and civil actions, including access to investor compensation schemes where available
• assistance in potential collective proceedings or coordinated actions with other victims

No lawyer can guarantee full recovery of lost sums, but targeted assistance can increase the chances of protection and help you make informed decisions on how to proceed.

If you suspect you are the victim of an online trading scam, it is important to act promptly.

Contact the Firm: one of our professionals will examine your documentation and advise you whether there are legal grounds to proceed.

FAQ – Trading Scam

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