News Release
Investor Alert: CSA Issues Investor Watch Regarding Foreign Currency Exchange (Forex/FX) Trading
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Date:
2012-03-29 -
Number:
2012/24
Saint John – The Canadian Securities Administrators (CSA) today issued an investor watch to make investors aware of the significant risks involved in foreign currency exchange (Forex/FX) investments. Investors who trade Forex are also warned against dealing with unregistered firms offering Forex trading.
The investor watch was created after CSA staff identified an increase in unregistered foreign exchange trading services being offered to Canadian investors, by both Canadian and foreign firms.
“Forex trading can be complex, volatile and extremely risky. It should only be entered into if investors are aware of the risks and prepared to lose their investment,” said Bill Rice, Chair of the CSA and Chair and CEO of the Alberta Securities Commission. “If they do enter this market, investors are advised to get expert advice from a registered professional before participating in Forex trading or purchasing a Forex-related investment.”
Use the National Registration Search or check with your local securities regulator to find out if an individual or firm is registered in your province or territory.
To improve public understanding of foreign exchange trading, the CSA have published a detailed document describing Forex and the various risks associated with this type of investment. It has also created a Forex resource page on its website.
Investors should be aware of the potential for fraud and avoid offers to trade Forex associated with any
of these characteristics:
- a guarantee of little or no risk and high investment returns;
- dealers or brokers that are not registered with the provincial or territorial securities commissions, and typically are based outside of Canada where it can be difficult or impossible to protect or retrieve funds;
- an unwillingness to discuss the past performance or track record of the specialist traders who will purportedly handle their money;
- an unwillingness to identify specialist traders or traders located in offshore jurisdictions who will purportedly handle their money; and/ or
- high-pressure sales techniques to buy a Forex investment, to purchase software or take courses related to Forex trading.
This investor watch is published on the new Investor Alert Page and is the first major one issued by the CSA since the launch of this resource on its website. This centralized location of investor alerts is designed to aid the public in identifying potential threats related to investing.
The Investor Alerts list is available on the CSA website.
The CSA, the council of the securities regulators of Canada’s provinces and territories, co-ordinates and harmonizes regulation for the Canadian capital markets.
For more information:
Carolyn Shaw-Rimmington | Sylvain Théberge |
Mark Dickey | Richard Gilhooley |
Ainsley Cunningham | Wendy Connors-Beckett New Brunswick Securities Commission 506-643-7745 |
Shirley Lee | Jennifer Anderson |
Janice Callbeck Office of the Attorney General Prince Edward Island 902-368-6288 | Doug Connolly Financial Services Regulation Div. Newfoundland and Labrador 709-729-2594 |
Helena Hrubesova | Louis Arki |
Donn MacDougall |