Everyone likes to believe they wouldn’t ever fall for a scam. But, over the years, several really intelligent people have fallen victim to con artists with cunning, well-established schemes, and even seemingly trustworthy businesses. In retrospect, some of the largest frauds in history may have seemed obvious, but at the time, investors had little cause to be wary. So what can we infer from the past? How can we prevent a similar situation? To protect you, your money, and yourself from potential investment scams, we examine some of the largest frauds ever.

 

FTX

There are more than $8 billion at stake.

The well-known cryptocurrency exchange FTX debuted in May 2019 and declared bankruptcy the previous year. Bankman-Fried (SBF), the founder and former CEO of FTX, has been charged with fraud. SBF has made a fortune in the crypto industry thanks to the successful career he and the business he created, FTX, have built over many years. Yet everything vanished into thin air when FTX collapsed. FTX experienced a crisis after SBF covertly transferred $10 billion in client funds to his proprietary trading company, Alameda Research, according to Reuters. Money is missing—at least $8 billion. Eventually, Bankman-Fried was detained, but a federal magistrate in the United States later granted his release on a $250 million bond.

 

Black Diamond Financial Services

The sum in question: $35,000,000

From 2007 through 2010, the “Black Diamond” fraud took place. By managing many hedge funds, Keith Simmons and Deanne Salazar collaborated with other partners to con clients into making investments in the foreign currency markets. 240 clients over several years invested $35 million until their filthy laundry was out. Keith Simmons is accused of defrauding $35 million worth of hedge fund investors. Black Diamond Capital Solutions was revealed to be a pyramid scheme where investors received no return and their money was never utilized in the foreign exchange market. Following a thorough investigation by the CFTC, America’s financial regulators, Keith Simmons and Deanne Salazar received sentences of 40 years and 4.5 years in jail, respectively.

 

Trade FVP

The sum at stake is enormous but not known.

Online forex broker FVP Trading is a Ponzi scheme. Numerous traders’ funds that they had invested in the broker had been frozen. The broker continues to employ a variety of techniques to maintain clients’ trust in it, including hosting offline seminars and making claims about receiving purported third-party money. The director of the FVP Trade Representative Office in Quang Binh, Vietnam, was detained on August 8, 2022.

 

Forex-3D

There are 1.9 billion Thai Baht at stake.

The Forex-3D Ponzi fraud was exposed by Thai police in 2019. Celebrities and government leaders are among the clientele of Forex-3D, a brokerage that provides investors with short-term, high-return products. Thousands of people were duped by the scheme, which was fueled by celebrity rewards. Savika “Pinky” Chaiyadej, a well-known Thai actress, her mother Sarinya Chaiyadej, and Surayuth Chaiydej, her older brother, were among the 19 persons detained for allegedly robbing customers of their money using a “Forex-3D scam.” Via the website forex-3d.com, the con trick convinces victims to finance their money in foreign exchange with the promise of a 60–80% return. Those who invested, however, did not receive the promised returns on their investments. The DSI reports that around 14,000 people were conned.

 

Capital Oli

Amount at issue: $50,000,000

Oli Capital is an Australian-based provider of financial services that was founded in 2018. Oli Capital invests in a variety of companies, gold, and hydrogen energy concept projects, according to its website. Recently, Oli Capital failed, and it’s thought that the CEO fled with the money. The problem has gained attention in particular because of an open letter reportedly written by Qi Luo, CEO of Oli Capital, to all investors. The letter enraged many investors because it was combative and even confrontational. The problem is still present. We’ll monitor the circumstance.

 

Conclusion

The fact that there was virtually never a meaningful method for investors to recognize they were about to be defrauded of a significant sum of money is a disturbing component of these frauds. Fraudsters are often dealt with, found guilty, and frequently sentenced to lengthy jail terms, but investors are not always entitled to get their money back. The executives engaging in these types of fraudulent operations are incredibly cunning and frequently get away with it for years, concealing their actions from investors as well as auditors and regulatory bodies like the SEC.

What can investors do, therefore, to safeguard themselves against fraud? Maybe the most crucial step is to diversify your portfolio as much as you can. You should diversify your assets among several businesses in case one fails, whether due to fraud or just declining profitability. If you invest in a company that ends up at the centre of the next big stock market controversy, you may still only lose a small portion of your money thanks to a well-diversified portfolio.

The five most significant financial (forex) fraud instances in recent memory are listed above. Iforexview’s top priority is always to safeguard the legitimate rights and interests of forex traders. Iforexview made these examples public to raise awareness of the dangers among all traders. Every trader should use caution when choosing a broker. Iforexview monitors trends, offering real-time information on specific traders and assisting investors in avoiding shady brokers. Make sure to start a case against a broker if you want to find out if they’re secure.