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How do you verify a foreign brokerage company?

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Aussiesteve

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Just had an English sounding broker (based in Tokyo) on the phone trying to get me into buying Gold which he says could hit 1000 by end of February. Says you sign up at http://www.nextfutures.com which is supposed to be registered with the "Japan Futures Trading Board" (http://www.jftb.org). Has anyone heard of either body? Curiously the Next Futures site can be found with a Google Search (pretty slick site but how do we know its not a fake?) whereas the JFTB cannot be found at all.
I see on another thread today that there is some doubt about whether gold can go any higher anyway.

Most important question : how do you verify companies such as these? I've tried googling ["financial regulatory body" +Japan ] but can't find any such body, let alone the jftb
 
Re: How do you verify a foreign brokerage company

Aussiesteve said:
Just had an English sounding broker (based in Tokyo) on the phone trying to get me into buying Gold which he says could hit 1000 by end of February. Says you sign up at http://www.nextfutures.com which is supposed to be registered with the "Japan Futures Trading Board" (http://www.jftb.org). Has anyone heard of either body? Curiously the Next Futures site can be found with a Google Search (pretty slick site but how do we know its not a fake?) whereas the JFTB cannot be found at all.
I see on another thread today that there is some doubt about whether gold can go any higher anyway.

Most important question : how do you verify companies such as these? I've tried googling ["financial regulatory body" +Japan ] but can't find any such body, let alone the jftb
Click to expand...

They are appealing to the basic emotions of greed ("I can makes heaps without any effort") and fear ("I better get in now so I don't miss out").

Basic rule of thumb: do not trust any company that calls you. Run from any company that calls you from overseas. Never, ever send money to an overseas company that asks you to open an account offshore. Once your money is offshore you can pretty much kiss it goodbye.


The exceptions to this are the few, large reputable brokers that many people around here are using anyway.
 
Definately sounds dodgy!

if you want exposure to Gold there are numerous ways/brokers who would be able to help you out right here in Australia. Hopefully someone else may be able to point you in the direction of a reputable Australian based operation.

As MS+T said once you send your money overseas there is very little chance of getting it back.
 
Aussiesteve said:
Just had an English sounding broker (based in Tokyo) on the phone trying to get me into buying Gold which he says could hit 1000 by end of February. Says you sign up at http://www.nextfutures.com which is supposed to be registered with the "Japan Futures Trading Board" (http://www.jftb.org). Has anyone heard of either body? Curiously the Next Futures site can be found with a Google Search (pretty slick site but how do we know its not a fake?) whereas the JFTB cannot be found at all.
I see on another thread today that there is some doubt about whether gold can go any higher anyway.

Most important question : how do you verify companies such as these? I've tried googling ["financial regulatory body" +Japan ] but can't find any such body, let alone the jftb
Click to expand...

You can contact ASIC (via email) or check their 'Fido' site for known scams/scammers:

http://www.fido.gov.au/fido/fido.nsf/byHeadline/Scams & Swindlers portal

Sounds like an overseas cold caller. You will usually find that they do not hold an Australian Financial Services License. One good way to handle them is to say that you will check with your broker or ASIC and listen to their response.

There have been a few of these over the years originating out of the U.S. or South East Asia.

When in doubt, check it out.

Cheers.
 
Thanks guys - I checked it out via ATSIC who referred me to the international site http://www.iosco.org/ and the Japanese equivalent of ATSIC www.fsa.go.jp/ .
Its not listed as a scam but its not showing up as a registered company either. I read up some more on 'cold calling' and it has all the hallmarks.
I have emailed ATSIC and FSA (Japan) and will post any replies here.
I got to say I am thoroughly familiar with scams directed to us (we're in the accommodation business) but none were quite as persuasive as this one. Its been an interesting education! Again thanks all of you. I'll stick with Australian registered brokers.
 
Trembling Hand said:
No interest will kill ya. Do it with a long dated fut if you want to use a trading instrument for any peroid over a week. (not to long dated)
Click to expand...

There is actually no interest on holding with IG, but they only offer near-date futures and you will have to roll them as they expire. The spread you pay, however, is close enough to having to paid interest.

The CFDs also expire well in advance of the real future exp date.
 
skc said:
There is actually no interest on holding with IG, but they only offer near-date futures and you will have to roll them as they expire. The spread you pay, however, is close enough to having to paid interest.

The CFDs also expire well in advance of the real future exp date.
Click to expand...

Are you certain about that? Quite sure that you will have to pay interest on that...
 
Hi Aussiesteve,

did you hear back form ATSIC and FSA (Japan?), I have been chased by these guys for the last two days. They are aggressive and seem to be really good at what they do. All my searches did not result in any Scam associated with them.
 
zetoinvest said:
Hi Aussiesteve,

did you hear back form ATSIC and FSA (Japan?), I have been chased by these guys for the last two days. They are aggressive and seem to be really good at what they do. All my searches did not result in any Scam associated with them.
Click to expand...
A few years ago the japanese futures business was badly regulated and got its liquidity by using boiler rooms of aggressive sales people hitting up punters in Australia and USA. Recently they have made some progress with regulation, electronic exchanges, and cracking down on boiler rooms, and the vision is for Tokyo to become the number 2 futures exchange in the world after Chicago. But you should never need to use boiler room of salespeople to get liquidity!!!

see this old article

http://www.futuresmag.com/cms/futur...y.aspx?{C0189F58-B26F-4F86-89AE-13975AEDA9E2}

Commodities in Japan were seen as disreputable and dangerous gambling toys. The industry seemed intent on living up to its reputation, with a network of boiler room sales offices acting as a critical liquidity provider, and so-called clearing and settlement amounting to little more than ledger entries. But a wave of Young Turks like Himawari CX veteran, and now the head of FIA Japan, Yasuo Mogi pushed for and achieved revolutionary reforms in the commodities sector, with the Tokyo Commodity Exchange ( Tocom ) acting as the bulwark against corruption and provincialism. Tocom’s energy complex quickly attracted bona fide hedging, and its gold contracts proved a draw to money from outside the country ”” largely from Australia but also from the United States.
Click to expand...
 
zetoinvest said:
Hi Aussiesteve,

did you hear back form ATSIC and FSA (Japan?), I have been chased by these guys for the last two days. They are aggressive and seem to be really good at what they do. All my searches did not result in any Scam associated with them.
Click to expand...

Hi zetoinvest,
No I haven't heard back from them ASIC or the Japanese equivalent but ASIC did assure me that over the phone it would be investigated. I made a similar post on Yahoo answers and have found others who have been similarly approached. I do know that they are not listed with ASIC (a fact that the caller didn't deny) and therefore as a foreign entity they cannot legally trade with Australians.

Personally I'm going to take the advice from the guys above and stay out of foreign deals - I just don't know enough to take the risk anyway.
 

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