Investors need to carry out strict due diligence before committing to any investment scheme — be it forex trading, savings instrument or any other money-multiplier programme that appears lucrative to them. The latest incident involving more than 200 investors with MMA Forex Online Trading Services is a classic case in point.
The company appears to have a global exposure — at least from its website. But the site does not reveal its physical address or contact details. Its CEO, Malek Naureed Awan, a UK-educated businessman, appears to have had trouble with the law a few times before this incident.
The company invites investors to invest online through its portal, without human intervention, and trade through its online platform. Its website also does not give details of any physical address or contact details — enough to raise eyebrows about its authenticity and credibility. Like most schemes, this allows investors to initially make money and lures them to invest more, before defrauding them. This has almost all the ingredients of a fraudulent scheme. Yet, investors failed to see the loopholes.
There are successful online forex trading platforms that periodically train new investors and help them make money. Some of them regularly advertise about taking a new batch of investors and helping them trade online and benefit from the opportunities that arise when currency rates fluctuate. The recent slide in the value of the Indian rupee is a case in point where some investors might have made a killing. However, government regulators, licensing authorities and law enforcement agencies should act in cohesion to alert investors of any misdeeds by companies. They should also strengthen vigilance against these companies that play with other people’s money.
Authorities should alert investors and citizens against such organisations and first shut down their websites and force the owners to pay up the investors’ money and then launch criminal proceedings. Dubai is a global financial services hub. Tougher action could ensure that the emirate remains free of fraudulent activities.
