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Review: Funded trading provider Topstep and its business model
Founded in 2012, Chicago-based TopstepTrader LLC did business as TopstepTrader (www.topsteptrader.com) until recently. Sometime in the last few months, it was renamed Topstep (www.topstep.com) a/k/a TopstepFX (www.topstepfx.com). All domains are currently redirected to the main domain www.topstep.com. This is now allegedly operated by Topstep LLC in Chicago. We have not found this company. Michael Patak is named as the economic owner and main principal. There are currently 191 people connected to the traded funding provider on LinkedIn.
Latest Updates
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German BaFin investigates SafeIncome broker scam
German regulator BaFin announced today that an investigation had been opened against the broker scam SafeFund. The scam claims to be a regulated SICFund, with the applicable law being the offshore paradise of Vanuatu. However, no legal entity is mentioned on the website. We found only crypto companies as facilitating payment processors. Credit and debit card payments are also processed through the notoriously licensed Estonian BitTheBank.
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Still active! UK FCA warns against Gloffix scam
We have already warned several times in the last months against the Gloffix broker scam, which is active with the domain www.gloffix.com. Now the UK Financial Conduct Authority (FCA) also issued an investor warning against Gloffix. Advaniq Ltd, registered in the Marshall Islands, allegedly operates the scam. The Bulgarian Key Solutions Ltd is the stated payment agent. The broker works with the Sirix Trader platform and MetaTrader 4.
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Attention! Funded trading clients could violate regulatory requirements
We have received initial feedback on our articles about funded trading accounts from our alert whistleblowers. One interesting opinion on the legal and regulatory situation for funded traders, i.e. the clients of funded trading providers like Topstep et al, points out that they would have to register with the competent regulator. The apparently legally competent whistleblower, therefore, recommends that all such traders in the U.S. to seek legal advice and conduct due diligence. He also believes that the U.S. CFTC, for example, will take action against Topstep et al.
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Funded Trading Accounts – Ripping off inexperienced traders?
It sounds fantastic what is promised on the websites of the providers of funded trading accounts such as Topstep or XLtrade. They promise potential traders do not need their own money for trading, but they will provide it. Even though traders don't need their own funds, they may keep up to 80% of the profits made while the providers bear the losses. Currently, Topstep and XLtrade are doing massive advertising on Google and social media. The catch of the story is that you have to pay setup fees, pass a costly trial period before you may or may not get access to funds.
Payment Processors
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Illegal broker BTC-Trends promoted by THE NEWS SPY fraud campaign
The offshore broker BTC-Trends, operated by Cordelino Ltd registered in St. Vincent & the Grenadines, does not have a license and is most certainly a scam. The scam is being promoted today via THE NEWS SPY fraud campaign on the SafeInvestmentsNow website. The scam is facilitated by PaynetEasy payment processors for credit and debit card payments. Registration is apparently not currently possible directly through the website. Potential victims have to be referred via one of the fraudulent marketing campaigns that operate as Introducing Brokers.
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Primic – A German car dealer acting as an illegal payment processor for scams
Primic GmbH with the registered office in Berlin was established in September 2020, the German companies register says. Slawomir Cieszynski from Poland is registered as director and beneficial owner. According to its articles of association, the purpose of the company is to trade in motor vehicles. We do not know whether the company earns money with it. However, we know that the company makes money as an illegal payment processor for scams like AvaChoice.
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Neglecting Eurojust Guidelines – Maltese Authorities refuse to investigate scam-facilitator Paytah
Malta is greylisted for good reasons, mostly for their failing regulators. Malta-licensed, Phoenix Payments Ltd d/b/a Paytah, refuses to assist the many victims who wired money to the company to top their accounts with broker scams like RoyalsFX, LincolnFX, or CodeFX. Victims reported these transactions to the MFSA. The regulator replied that they would not investigate and asked the victims to report Paytah to the Central Bank of Malta, which replied that it would not investigate such complaints. The victims also emailed Kenneth Farrugia, the Director of Malta Financial Intelligence Analysis Unit, who did not reply.
Cybercrime Court Cases
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Cybercrime Trials – Gal Barak’s wife acquitted but more charges to come!
E&G Bulgaria allegedly defrauded tens of thousands of consumers in Europe out of more than €200 million with its scams According to law enforcement agencies in Germany, Austria, and Switzerland, the principals of this organization were Israelis Gal Barak and Gery Shalon and their Russian partner Vladislav Smirnov. Barak was sentenced in Austria in September 2020 to four years in prison and restitution payments in the millions for investment fraud and money laundering. His wife, Marina Barak, who was also charged, was acquitted; the prosecutors appealed.
Regulatory Updates
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Investor Warning – Tesler fraud campaign promotes FXActiv scam
In this morning's session analyzing active scam campaigns and the scams they promote, we have found for UK victims that the infamous Tesler campaign promotes the FXActiv broker scam. Anyone who registers with Tesler to make a lot of money quickly is automatically created as a victim of FXActiv, where they will lose a lot of money. The scam is active with the domains www.fxactiv.cc, www.fxactiv.co, and www.fxactiv.io. The Tesler campaign leads the future victims to the payment page of www.fxactiv.cc where the xPayz cashier processes payments.
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R4I – Regulated brokers ForTrade and Alpari have joint interests
Recently we reported that an investor warning issued by the UK Financial Conduct Authority (FCA) against TorexFX (https://torexfx.com) was incorrect. The FCA claimed that TorexFX and the domains associated with this scam https://gloryft.com and https://fxen.gloryft.com as illegally acting clones of the FCA and CySEC regulated broker ForTrade. In fact, however, these sites are jointly operated by ForTrade and the Russian broker Alpari. Both brokers have a vast network of entities, domains, and websites. We want to learn more about them and their activities.
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Incorrect FCA warning against alleged clones of regulated ForTrade broker
The UK FCA issued an interesting and incorrect investor warning today. The UK regulator warns against the TorexFX, an allegedly unauthorized clone of the FCA and CySEC regulated broker ForTrade. The domains mentioned in the warning are https://torexfx.com, https://gloryft.com, and https://fxen.gloryft.com. The GloryFT domains are operated by the Russian Alpari Broker LLC and the FCA-regulated ForTrade Limited. Thus, the FCA has not recognized that an FCA-regulated entity conducts allegedly "unauthorized" activities.
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