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It looks like the clone wars don’t just happen in a galaxy far, far away! Financial watchdogs and regulated forex brokers themselves have been issuing warnings on fraudulent firms posing as licensed entities.

forex clone brokerClone forex brokers have been on the rise since last year, setting up shop by using name variations of reputable companies to trick clients into thinking that they’re forking over their hard-earned money to regulated firms. This kind of scam isn’t limited to the forex industry, as corporate cloning or the practice of unauthorized businesses conducting operations using the data of established ones has been around for decades.

Fortunately, financial regulators such as the Commodity Futures Trading Commission (CFTC) in the U.S. or the Financial Conduct Authority (FCA) in the U.K. have always been on the lookout for these schemes. The CFTC recently filed a civil enforcement complaint against IB Capital FX, LLC for soliciting and accepting at least $50 million from nearly a thousand clients all over the world without the necessary licenses.

Wait a minute, isn’t IBFX a large regulated forex broker? Yes, but that’s a completely different firm and isn’t remotely associated to IB Capital FX. Gotcha.

In the U.K., the FCA regularly issues warnings against clone forex firms, with the latest ones alerting investors and the public about Credence Financial Earnings Ltd. posing as FCA-regulated CFE (UK) and Raymond James Investment Services Ltd. or Equerry Investment Management masquerading as Raymond James Investment Services Ltd. t/a Equerry Investment Management. Sneaky, huh?

Some forex clone brokers even go the extra mile and publish the firm reference number or license details on their websites, which also look deceptively like the ones they are imitating. Just last week, regulated broker FXOpen made an announcement clarifying that they are not affiliated with sites and which are using the FXOpen trademark and design elements on their webpages.

In Australia, financial industry watchdog Australian Securities and Investments Commission (ASIC) also issued an official warning against and which are using publicly available company information of licensed firm ABS Group Pty. Ltd. and is targeting investors from China. As Victor Golovtchenko of Finance Magnates points out, Chinese clients are particularly vulnerable to such schemes due to lack of information and appropriate regulation in the country.

Potential investors in other parts of Asia may also be targets of such schemes, with Hong Kong’s Securities and Futures Commission ramping up its efforts to crack down on clone forex brokers. The regulator recently updated its alert list, adding Wells Fargo International Finance Group and Wells Fargo Global Investments (Hong Kong) Company Limited falsely claiming to be associated with the real Wells Fargo.

To protect yourself from falling victim to all this, double-check or even triple-check that you are transacting with officially regulated forex brokers and not their clones. Local financial regulators typically have a watch list of fraudulent firms in the Dark Side of the Force. At the end of the day, there is no substitute to staying vigilant, doing your own homework, and being aware of other types of scams in the forex industry.