What Is A Regulated Broker? 

If you believe you have lost money through a broker, it’s important to first establish whether they were a regulated broker or not. Regulated means that the broker in question is responsible to a body and, typically, brokers in the USA will be regulated by the FCA (Financial Conduct Authority). From the millions of pounds that we so far recovered for clients here at Global Securities, we have found that an increasing number of brokers that serviced our clients were regulated by CYSEC, the regulatory body in Cyprus. 

Although these clients did lose money through a regulated broker, the good news is that these companies and brokers can be held responsible for wrongdoings and misconduct. With our legal team’s knowledge and experience, we can apply pressure on these regulated brokers to ensure that they comply with the complaints procedure in the right way.

How Do Regulated Brokers Lose Money?

Regulated brokers might be approved and responsible for their trades, but that doesn’t make them reputable. Unreputable brokers will act on their client’s behalf, but instead of making the investments they’ve been instructed to do, they will make their own decisions on what to invest in, in the belief that it will pay off for the client and that they get to keep any extra returns. Often though, this can have the opposite effect and most regulated brokers who choose to go down this path will only end up losing their client’s money. 

Another way in which regulated brokers lose money is through simply being new to the trading circuit and, instead of trading using a tested strategy, they will make trades based on their instinct, for example, if a trader feels as though the market will move in one direction or the other. When a new regulated trader enters the market, they often do so when their emotions are running high, meaning that their judgement is often impacted. 

Before Using A Regulated Broker

Before you consider using a regulated broker, it’s important to protect yourself from untrustworthy brokers by carrying out some research beforehand. 

• Carry out a quick online search of the broker. An online search can provide insights into whether any negative feedback or comments could simply be from a disgruntled trader that’s just had bad luck, or it could indicate something more serious.  
• Look for complaints from other traders about not being able to withdraw funds following their trades. If there are, you can either contact the user and ask for more information, or simply steer clear of the regulated broker in question. 
• Read through the fine print of all documents when opening a new account. Often, brokers use money incentives to entice new traders, which can then be used against you when you try to withdraw the funds.
• Start with small amounts of money before making any large trades with a new broker. Trade it for a month or so and then make a request to withdraw the funds to see how the broker reacts. If there are any problems, attempt to discuss them with your broker and see how the issue is resolved. If you have any problems, you know to avoid making large investments with the broker in question. 

What To Do If You Have Lost Money Through A Regulated Broker

If you believe you’ve lost money through a regulated broker, or through a potential broker scam, then please get in touch with us as soon as possible. There are many occasions where traders put the blame onto brokers for poor results and losses, but sometimes regulated brokers really are at fault. 

Our team of legal experts will be able to help identify whether your lost money was through the mistake of a regulated broker or broker scam and then suggest the recommended next steps. We offer free consultations, so get in touch with the team at Global Securities today to book an appointment.