My Instagram feed is getting worse, litterally every other post is a trading scam advert. When browsing through Instagram it is completely evident that there is zero control over what is posted, portrayed and promoted for potential traders.
Every single post looks like a get-rich-quick scam with supercars, champagne and “lifestyle” finfluencer traders seemingly making millions from trading the markets. Not to mention the “forex education” providers who claim they can cover the cost of a weekend away in the sun with a single trade put on from a private jet.
Our exclusive research showed that over £75m was lost to scams on social media but that figure will be much higher by now as Meta as reduced the amount of manual fact-checking it does.
This is going to have a catastrophic effect on how people invest as the UK regulator has said that over 85% of UK investors take advice from finfluencers.
The worst thing is that Facebook, Mark Zuckerburg and Meta are profiting from allowing these adverts to be run on their platforms. You can see from how well the Meta share price has performed recently
Just check out these hashtags on Instagram: #forex & #trading.
So, are any of these self-professed trading experts on the Instagram platform legit?
Financial services are one of the most highly regulated industries in the world and financial promotions are even more so. They need to carry a plethora of risk warnings, disclaimers and caveats before they are even put to the compliance and legal teams for consideration.
It’s obvious that Peter Andre and Richard Branson didn’t really make their money from trading in binary options (as some fake articles promoted on social media suggest). Now it’s just kids driving gold Bentleys and quaffing champagne on a private jet.
Anyone who understands the risks of trading would be supposedly clever enough to know that all these Instagram posts are a complete scam. But, those that don’t (and aren’t) are going to get drawn in and scammed.
Social media is completely unregulated and if the government can’t stop terrorist propaganda they won’t have much luck trying to ban some spiv from claiming to be a millionaire trader.
It’s up to the trading platforms to use social media influencers responsibly. Whilst either not allowing inexperienced customers to have an account (although this is probably a little unfair) or at least reducing the leverage available to them initially.
Even if the FCA were to insist that all affiliates and introducers were regulated, it wouldn’t stop offshore brokers.
What are Instagram trading scams?
Trading scams on Instagram are “get rich quick schemes” whereby influencers post lifestyle pictures and videos of expensive cars, jewellery and holidays, perpetrating that they were paid for by successful trading. The FCA even joined Instagram to warn users of the danger of forex scams
Types of trading scam on Instagram
The main types of instagram trading scams are;
- Forex scams – finfluencers claiming to be able to make you money trading currencies
- TikTok scams – these are normally copy trading scams these days with influencers offering free trading signals
- CFD scams – this usually revolves around finfluencers selling how to trade CFD courses
- Bitcoin scams – this is just pure theft where you open an account with a fake bitcoin trading platform
Instagram forex traders
Richard is the founder of the Good Money Guide (formerly Good Broker Guide), one of the original investment comparison sites established in 2015. With a career spanning two decades as a broker, he brings extensive expertise and knowledge to the financial landscape.
Having worked as a broker at Investors Intelligence and a multi-asset derivatives broker at MF Global (Man Financial), Richard has acquired substantial experience in the industry. His career began as a private client stockbroker at Walker Crips and Phillip Securities (now King and Shaxson), following internships on the NYMEX oil trading floor in New York and London IPE in 2001 and 2000.
Richard’s contributions and expertise have been recognized by respected publications such as The Sunday Times, BusinessInsider, Yahoo Finance, BusinessNews.org.uk, Master Investor, Wealth Briefing, iNews, and The FT, among many others.
Under Richard’s leadership, the Good Money Guide has evolved into a valuable destination for comprehensive information and expert guidance, specialising in trading, investment, and currency exchange. His commitment to delivering high-quality insights has solidified the Good Money Guide’s standing as a well-respected resource for both customers and industry colleagues.
You can contact Richard at richard@goodmoneyguide.com
