Forex scams and other trading cons

In the Inferno, Dante Alighieri describes hell in vivid detail. The eighth circle of hell is called the Malebolge (‘evil pockets’), and comprises ten circular bolgias (trenches), filled with fraudsters who have committed knowing evil. Taking inspiration from a humorous yet truthful piece on integrity in the market place by Brett Steenbarger, I have sent the offenders of the financial markets to the eighth circle of hell:

dante.jpg

The market equivalent of these winged fiends can be found in the below image (these offenders leaped out at me after five minutes of searching on Google).

The ten circular trenches of the Malebolge (‘evil pockets’):

Bolgia 1: Here belong the third-tier brokers who sucker in clients with false claims (eg: zero cost trading, no-slippage guarantees) and the authors of books who purport to know the secret to making extraordinary profits in the markets. For their offences, these panderers and seducers are repeatedly whipped by horned demons. (Canto XVIII)

Bolgia 2: The offenders who belong here include all those who practice flattery, including all those tell you that you can succeed in the market if you have good money management and if you just give it your very best shot, making no mention of the need for an edge. They are the sellers of false hope. Flatterers are steeped in human excrement. (Canto XVIII)

Bolgia 3: Those who take payments without making it known, can be found residing in this trench. Culprits include all those who covertly refer brokers and other services. Those who committed simony are placed head-first in holes in the rock, with flames burning on the soles of their feet. (Canto XIX)

Bolgia 4: This trench of market astrologers, sorcerers and false prophets must be spilling over with offenders. Here, we place the hundreds of firms selling off-the-shelf trading systems, all those charging a fee for their buy/sell signals, and those charging a fee for their crystal ball forecasts. All these false authorities claim to have superior foresight as to the direction of the market, but they themselves know they have no such foresight. These sorcerers and false prophets have their heads twisted around on their bodies backward, so they can only see what is behind them. (Canto XX)

Bolgia 5: The culprits homed here tarnish the entire industry. They are the unscrupulous dealers and brokers who have no intention of giving fair prices in times of volatility, or whose systems conveniently fall over when traders are trying to exit their positions. They lure in the novice traders and then give them upward of 200:1 leverage, setting them up to explode. In this trench you will also find the tricksters who give ‘free’ seminars and educational advice as a way of generating sales leads. The sinners of the fifth bolgia are punished by being thrown into a river of boiling pitch and tar. In addition, should any of the grafters try to escape the pitch, a horde of demons armed with grappling hooks and barbs stands guard over them, ready to tear them to pieces.

Bolgia 6: This where all the hypocrites in the industry are punished. The group that immediately come to mind are those who produce charts and other analysis and advice for public consumption, but who don’t believe or trade in their own views. They are being paid to produce garbage advice which they have no intention on acting upon. They just want their fee. Many systems and signal sellers also belong here because they are making their money from milking the public with trading approaches they don’t have any real faith in.

Bolgia 7: Here are the thieves. Outright theft is rare in the industry, but it can be found. Do you want to pay a whopping fixed spread of 5 pips on cable? There are brokers out there with such inflated spreads. It is more common however, to find the thievery in sugar coated form, so the public don’t realise what they are really being asked to swallow. Nevertheless, the thieves can be found around every corner. They are always knocking on our door, trying to sell, sell, sell. They just won’t let us be, with our own independent analysis and with our self-developed trading strategies. The seventh bolgia is also filled with serpents, dragons and other vengeful reptiles that torture the thieves endlessly. The bites of some of the snakes cause the thieves to spontaneously combust, only to regenerate their bodies for further torment in a few moments.

Bolgia 8: Home of the fraudulent advisors. Here we will place all the trading publications and event organisers who accept advertising and promotions from the tricksters in the industry. These offenders find endless ways of re-packaging and selling the myth that profits are there to be had. Fraudulent advisors are encased in individual flames. (Cantos XXVI and XXVII)

Bolgia 9: In this trench are the sowers of discord. The fear mongers who sell their vision of doom (eg: market apocalypse, USD destruction). They make a name for themselves, appear on tv, and extract a comfortable living from doom-mongering and the perpetuation of fear. They are forced to walk around the circumference of the circle bearing horrible, disfiguring wounds inflicted on them by a great demon with a sword. (Cantos XXVIII and XXIX)

Bolgia 10: Well, you can place anybody who doesn’t fit in to any of the above categories here. Groups of various sorts of falsifiers (alchemists, counterfeiters, perjurers, and impersonators) are afflicted with different types of diseases. (Cantos XXIX and XXX). 

With so many deceivers and con artists sponging a living at the direct expense of the public, it’s no wonder so many people walk away with burned fingers. Being one of the deepest circles, the sinners in the eighth circle must endure particularly great punishment and suffering.

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2 responses to “Forex scams and other trading cons

  1. From Wikipedia: “Between 2001 and 2006 the U.S. Commodity Futures Trading Commission has prosecuted more than 80 cases involving the defrauding of more than 23,000 customers who lost $300 million, mostly in managed accounts.”

  2. Pingback: Good to Go Pile . . « Trading for the Masses

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