Protecting your forex funds from fraud and default?

I m hoping to start a account with IB or Oanda . I have two questions about protecting your money with you forex brokerage.

1. How do you protect your forex account from any sort of fraud? like fraud withdraw

2. How do you protect your forex account from the brokerage if it goes backrupt?

thanks in advance

d

There are no guarantees although it seems a bit far fetched that a broker would defraud clients (his bread and butter) if his business is a profitable going concern. You would have to do your due diligence. A further safety measure is spreading your capital across a few brokers to avoid the risk of putting your eggs in one basket. That presupposes that you either have lots of capital or are sufficiently technically proficient to make small amounts work.

I have been with oanda for many years and had no issues with funds. They are very quick to let me deposit or withdraw with no issues whatsoever using credit card. The only big issue with oanda is they widen their spreads during news sometimes up to 30 pips.

Hi, I'm currently using forex.com (Gain Capital). Is it safe and has good services?

Thank you

1/ A withdraw can be done only to an account with the same name of the trading account.

2/ Choose the right broker ... well known, well established, no bonus or incentive, etc ...

Gain Capital is fine.

Protection from Fraud: Make sure the broker is regulated in a country that has reputable financial regulatory bodies and no complaints or disciplinary actions have been enacted against them. This website link also discusses some of the fraud awareness measures you can take when deciding on a broker.

http://www.cftc.gov/ConsumerProtecti...tion/index.htm

Protection from Default: There is really no 100% protection in that. Any broker can go belly up at any time if Bears & Stearns and Lehman Brothers who have existed almost since the founding of the USA did. One thing that can help is to check the adequacy of their capital by verifying them on the CFTC site. This only applies to USA brokers. If they are regulated by the CFTC and is registered with NFA which they should, they are required to meet the minimum capital requirement each year and CFTC publishes this information on their site updated annually. You can see the most recent and all of the historical net capital of all brokers via this link:

http://www.cftc.gov/MarketReports/Fi...FCMs/index.htm