Kato Prime review
Kato Prime is a licensed broker claiming to offer more than 5000 instruments traded on MetaTrader 4 and MetaTrader 5. At the same time, though, the brokerage involves in highly suspicious activities and indeed mislead customers by making them sign contracts with another entity that’s not regulated. Find out more details in the full Kato Prime review.To get more news about
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Kato Prime REGULATION AND SAFETY OF FUNDS
As a brand of HonorFalcon Global Limited, Kato Prime is licensed in Belize and can see the authorisation below. However, the IFSC- the regulator in Belize, doesn’t impose a complete regulatory framework, and we can easily dismiss the local market as not trustworthy enough. The only rule worth mentioning is the capital adequacy of $500 000, which only proves that the people who found Forex companies have some funds at disposal. On the other hand, brokers licensed by IFSC should not follow strict internal procedures, keep clients’ accounts segregated or provide negative balance protection, like CySEC (Cyprus) and FCA (Britain) licensed companies do. As seen from the first screenshot below, Kato Prime puts the deposits in some Client Moneys trust, and that’s just a dubious practice, which means that the funds are not kept secure. But we are only at the beginning of the story.
The brokerage reviewed is actually operated by Kato Prime Limited– a company registered in St. Vincent and the Grenadines, where the local regulator SVGFSA doesn’t license or monitor Forex trading providers. That being so, the IFSC license actually becomes worthless in this case as it’s granted to an entity registered and so-called regulated in another country. The most important thing to note, though, is that whenever you deposit with Kato Prime, your money goes out of your country if you are not a resident of SVG or Belize, of course. And when this happens, it becomes too challenging to track the money down.
That’s why we recommend companies authorised by dependable regulators like CySEC and FCA. Both ones impel brokers to keep deposits segregated in trustworthy local banks, which ensures that clients won’t lose their capital if something unexpected happens. The segregation also improves transparency, speeds withdrawals up, makes chargebacks easier and generally helps prevent fraud. What’s more, the European FX companies are covered by deposit insurance funds laid down to reimburse clients in case of unforeseen events- CySEC brokers’ clients can get up to €20 000 in compensation, while the British guarantees are even up to £85 000.
Kato Prime TRADING SOFTWARE
Kato Prime offers both MetaTrader 4 and MetaTrader 5– the leading retail Forex platform equipped with advanced features like Expert Advisors, its own programming language (MQL) and a marketplace with more than 10 000 trading apps. However, we couldn’t access the demo accounts we opened, so we can’t talk about real-time spreads and trading costs. We’ll just note that brokers offering decent platforms don’t automatically transform into reliable ones. Indeed, the absence of trustworthy regulation massively overshadows everything else.
As to leverage, we could choose between 1:1 and 1:500 while we were opening the account, which means that Kato Prime’s services may as well be too risky for some traders. Leverage is so dangerous that it’s now part of the regulatory regime in numerous countries- a maximum of 1:30 in the EU, UK and Australia and 1:50 in the US, to name just two restrictions.
Kato Prime DEPOSIT/WITHDRAW METHODS AND FEES
The minimum deposit is $15 allegedly via Credit/Debit cards and Wire Transfers, but we can’t confirm that’s true as the account we opened was not fully functional, and we couldn’t test the deposit system. In any case, depositing with bank cards is considered much safer as the method allows chargeback for up to 540 days.
As for withdrawals, there is nothing to discuss as the broker fails to specify minimum requirements, charges or any other conditions worth mentioning. The absence of information on the matter comes as a red flag because Kato Prime hides critical information about the trading conditions applied.
HOW DOES THE SCAM WORK
Kato Prime has a Forex license, but another unlicensed company operates it, so it’s a suspicious brokerage that’s worth being avoided. In fact, we’ve already encountered brokers licensed by offshore regulators that later turned out to be dirty scam schemes. That’s why we’ll now concisely describe how scammers usually act when trying to swindle as many people as possible out of their money.
So, when fraudsters get hold of your contact numbers, you’ll get a call, promised the moon and the stars if you deposit immediately. And to gain trust, those criminals will usually pretend to work for governments, financial authorities, banks, other reputable companies and so on. Scammers will be confident in what they say, so if you don’t see the warning signs, you may end up depositing fascinated by their fake commitment. However, the fraudulent game actually begins after you send the money. Once they have the desired deposit, the cons will distort prices and forge fake reports to make you believe you are on the winning side, manipulating you to start thinking big and consider more deposits.
Then, the fraudsters will continuously ask you to increase the size of the investment and invent stories to make you deposits over and over again. Sooner or later, though, you’ll get determined to withdraw some money, and then the scammers will ask you to deposit again because, according to their words, there are taxes and fees that you should pay. At this point, you’ll probably realise something wrong is going on, and when the scam becomes too apparent, the cons will simply stop answering your calls and e-mails.
