Sharjah: Five schoolgoing children in Sharjah have been forced to discontinue their education because of unpaid fees after their mum blew away $21,000 (Dh77,133) on a dodgy online trading platform, leaving the family in a debt spiral.
The mum, Roohi Imran, is a banker by profession. The 34-year-old Pakistani woman said she was tempted to open an account with overseas forex broker AroTrade and trade in the financial markets after reading rave reviews about the company on the internet.
“I saw stories about how people were making so much money from online trading that they had quit their jobs. The reports appeared so convincing that I believed them and decided to invest in forex as well. By the time I realised my mistake, it was too late,” said the Al Majaz resident who has now lodged a police complaint against the company.
Roohi said she opened an online account with AroTrade by making an investment of $1,250 in May 2019 but was tricked into putting more and more money in subsequent months.
“My initial investment got wiped out within a day. I thought that perhaps forex was not my cup of tea and decided to stay away from it. However an AroTrade agent called me the next day and persuaded me to try my luck one more time. He said the agent who frittered away my investment was a novice and that I could recover my losses if I invested another $1,000.”
Ruhi said no sooner did she remit the money than her online account went into a profit of $5,000. “I was thrilled and placed a request to withdraw the money but the company wouldn’t let me do that. I was told that I have to achieve 10 trading points before I could withdraw my money and I could achieve those points only if I continued trading with more money. I didn’t want to do that but the agent said that they needed additional funds to sustain my position and that the money will remain in my account.”
By July 2019, Roohi had shelled out $21,000 which included around Dh51,000 her cousin had given for safekeeping.
Ruhi said when her ‘profits’ swelled to Dh187,000 she placed a second withdrawal request but instead got a call from the agent.
“He advised me to withdraw 50 per cent of the profit and let the other half remain in the trading account. I grudgingly agreed. Imagine my shock when two days later my account was left with just $600. Before I could comprehend what was happening even those few dollars vanished and my account was reduced to zero balance,” said the mother of six. Her youngest child is one and half years old.
Roohi said the financial setback has had a catastrophic effect on her family, particularly her schoolgoing children aged between 13 and four years.
“Four of my children haven’t returned to school since the summer break because of unpaid fees while the fifth one hasn’t been able to start school as we have no money,” said Roohi who works for a bank in Sharjah.
“My husband works for an event management company. We were struggling because of bank loans. I thought I could make some quick money from online trading and straighten out our finances. As it turned out, I have dug myself deeper in debt,” she said.
Ruhi said she has accepted the fact that she won’t be able to get her money back. “All I want is to create awareness about the issue so that nobody else falls into the trap of dodgy investment schemes and ends up like us,” she said.
Top tips to avoid forex scams
What is forex trade: Forex trade is online buying and selling of foreign currencies online.
Learn how Forex trading works: Get a deep understanding of how the forex market functions before you get into forex trading. Remember, there are no shortcuts in forex trading. Beware of companies or brokers that promise you quick and easy returns. It could be a scam.
Don’t trust every website: Anyone can set up a website and make false claims of giving instant profits. Stay away from such websites. All authentic websites are members of NFA or CFTC. Verify the authenticity of the websites. Also, read the terms and conditions before entering into any deal.
Beware of phony marketing: There are many swindlers who pose as legitimate investment houses and firms while trying to convince you to invest with them. No matter how good the sales pitch sounds, do not fall for it. Never transfer money online, especially if it’s an overseas company.
Beware of companies offering unrealistic returns: Forex trading is not easy. Companies which guarantee unexpected profits and low risks, are most likely run by fraudsters.
Avoid dishonest brokers: Whenever you choose a broker, always validate his/her license and do a thorough background check.
Know the margins: Do not get into margin trading if you are an inexperienced trader as it may cause you heavy losses
Ask questions: If any broker or firm calls you and tries to convince you to invest with them, ask them how they found your details, where is their office, what are the substantial risks involved. Verify the physical existence of their office and go through their track records. Remember, anything that sounds too good to be true should not be trusted easily