CFD Review: UFX Markets (Formerly UFX Bank)

Important Facts 
  • Regulation: UFX Bank was totally unregulated and was widely reported to be engaging in highly unethical (if not illegal) practices. At some point in 2011 UFX Bank renamed it self UFXMarkets and became regulated in Cyprus under the authority of CySec. However it has been reported that many of the alleged questionable practices which were occurring when the company was unregulated are still ongoing til this day. 
  • Instruments: Forex, Indices, Stocks and Commodities. 
  • Features: No unique or particularly impressive features to mention. 
  • Leverage: Up to 200:1 
  • Minimum Deposit: $500 
The Platform 
When it comes to the platform there is not a great deal to talk about. UFX Markets only offer one way to trade Contracts for Difference and that’s through a web trading platform, however it has to be said that the platform is not that sophisticated and similar platforms are implemented on many other trading sites. While it will allow you to undertake and open positions and the such it is not a serious piece of trading kit and UFXMarkets doesn’t offer any well known platforms for download such as MetaTrader etc. UFXMarkets also offers the ability to open positions over the phone, however this is one of the areas where many report they experience the biggest problems with the company. With many customers reporting their account manager pressuring them to opening very risky positions they didn’t intend too. If this in fact the case it very disheartening to hear as it is a serious breach of the customers trust. 

Special Features 
When it comes to special features etc, there is not much to comment on. One point UFX Markets often likes to sell its self on, namely that the company gives you a personal account manager is quite disputable as many have said that has been the cause of a great deal of their problems with UFX Markets.  

Spreads 
The spreads listed on the website aren’t particularly great a 5 Pip spread on GBP/USD is particularly poor with many other companies being able to offer much tighter spreads on such major Forex pairs. The situation is much worse when it comes to some of the exotic instruments with some of the spreads being so wide it is hard to see how an individual could make any money at all. While I’m sure their are brokers with even worse deals on the table, it seems hard to say that the spreads at UFX Markets are competitive. Especially when reputable companies such as GFT offer extremely tight spreads. 

Customer Service 
This must be one of the area’s where UFXMarkets falls down the most. Their are numerous reports across the web about how UFXMarkets applies a lot of pressure on their clients to increase the amount of money deposited them offering huge deposit bonuses and then lock in their funds claiming that they can’t withdraw there cash until the reach certain trading limits. There seems to also have been instances where UFXMarkets have told their clients that they will be unable withdraw their deposited funds unless they enter into one final trade. Which often goes disastrously wrong leading to the clients whole account being depleted of funds often meaning the said client has lost several thousand dollars. Many reports of such instances can be found on a number of different websites from a number of different sources. This has lead many to conclude that UFXMarkets is a scam.   

Regulation 
UFX Bank operated from 2007-2011 unregulated with a number of warnings being made by regulators against people investing with the company (one of which can be found here and another here). However in 2011 the company stopped operating under the name UFX Bank and instead changed its name to UFXMarkets. The old UFXBank page used to redirect to UFXMarkets, it was around this time that UFXMarkets managed to acquire a CySec licence. Meaning that the rogue firm now had a licence to operate within all of the countries of the European Union. Many thought this would lead to a change in behavior however it appears that UFX have continued to operate in exactly the same manner as before. It has been reported that a number of former customers have reported UFXMarkets to CySec, however as yet no action has been taken. This could be either due to the fact that UFXMarkets has not broken CySec regulation or due to the fact that there is an ongoing investigation being undertaken (regulators often take a while to take action). I have also noted that some of UFXMarkets advertising banners seem to break MiFID regulation. There is particular regulation aimed at protecting retail consumers (advertising has to carry proper risk warnings etc.) and it appears that some of UFXMarkets advertising is in breach of this. 

Overall, all of this evidence which continues to mount suggests to me that one should avoid UFXMarkets like one would avoid the black death.

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