Our Broker Review Methodology & Ranking Criteria

Our Full-Proof Broker Review Methodology and Ranking Criteria Evaluates Brokers Accurately.

Our independent broker review methodology and ranking criteria are deep and thorough, strictly evaluating brokers for what they really are. Online financial fraud is becoming increasingly sophisticated; investors need more than just a surface-level opinion. At ScamReader, our mission is to provide a transparent, rigorous, and data-driven framework for evaluating the legitimacy of online trading platforms.

This document outlines the exact “stress test” every broker must undergo before we issue a rating. Our methodology is designed to separate legitimate, regulated financial institutions from predatory “boiler room” scams.

1. Our Mission: Integrity in Information

The core of ScamReader is built on the principle of investor protection. We understand that a single bad decision in choosing a broker can lead to life-altering financial losses. Therefore, our review process is not influenced by corporate partnerships or advertising revenue. We do not accept payment to “remove” bad reviews or “boost” a broker’s score. Every rating is earned through a deep dive into the broker’s operational history, regulatory standing, and user feedback.

2. The 5-Point Rating Framework

To maintain consistency, we score every broker on a scale of 0 to 10 across five critical categories.

A. Regulatory Compliance & Legal Status

This is the most weighted category in our audit. A broker without a license is a broker without accountability.

Database Cross-Referencing: We don’t just take a broker’s word for it. We manually check the registers of top-tier regulators, including the FCA (UK), ASIC (Australia), CySEC (Cyprus), and the SEC/CFTC (USA).

License Spoofing: We look for “clone firms”, scammers who steal the registration number of a legitimate company to appear legal. We verify that the domain name and contact details on the broker’s site match those on the official regulatory filing.

Tier-1 vs. Tier-3: We distinguish between prestigious licenses and “offshore” registrations (like Vanuatu or St. Vincent and the Grenadines), which offer little to no protection for retail traders.

B. Transparency & Corporate Background

A legitimate broker should have nothing to hide. As part of our broker review methodology and ranking criteria, we investigate the ‘who’ and ‘where’ behind each platform.

Domain Age and History: Using WHOIS data, we check if a broker claims to have “10 years of experience” but registered their domain only three months ago, a classic hallmark of a scam.

Physical Presence: We verify corporate addresses. Many scam brokers use virtual offices or fake addresses in London or Dubai.

Terms and Conditions Audit: We read the “fine print” to find predatory clauses, such as “non-deposited bonus” terms that prevent users from withdrawing their own principal capital.

C. Trading Environment & Costs

While safety is paramount, a broker must also be functional.

Software Integrity: We evaluate the platforms offered (MetaTrader 4, MetaTrader 5, or proprietary apps). We check for “Virtual Dealer Plug-ins,” which scammers use to manipulate prices and trigger false stop-losses.

Execution Quality: We analyze if the broker is an ECN (Electronic Communication Network) or a Market Maker (B-Book). While both are legal, Market Makers have a built-in conflict of interest that we disclose to our readers.

Fee Structure: We look for “hidden” fees, such as exorbitant inactivity fees or “maintenance” charges that are only disclosed after a deposit is made.

D. Customer Support & Conflict Resolution

How does a broker act when things go wrong?

The “Stress Test”: Our team contacts support via live chat, email, and phone. We ask technical questions about slippage and regulation to see if the staff is trained or simply following a sales script.

Response Time: We measure how long it takes to receive a human response. Scammers are often very fast during the “deposit phase,” but disappear once a trader makes a withdrawal request.

E. Withdrawal Reliability & Reputation

This is the ultimate test of a broker’s legitimacy.

Withdrawal Speed: We aggregate data from our user community to track how long a broker takes to process payments.

The “Tax” Scam: We immediately flag any broker that asks a client to “pay a tax” or “commission” upfront before they can withdraw their funds. This is a 100% indicator of a scam.

Third-Party Reputation: We monitor forums like Reddit, Trustpilot, LinkedIn, and the Better Business Bureau to identify emerging patterns of “withdrawal freezing.”

3. Data Collection & Verification Process

Our research is a hybrid of human expertise and automated monitoring.

Manual Verification: Every review is written and fact-checked by a financial analyst with experience in fraud detection.

Community Intelligence: We provide a “Report a Scam” tool that allows victims to submit evidence. When we see a spike in reports for a specific broker, we issue a “Scam Alert” immediately, regardless of the broker’s previous rating.

AI-Assisted Scraping: We use tools to monitor global regulatory “blacklists” in real-time. If the French AMF or the Italian CONSOB flags a broker, our database reflects that change within 24 hours.

4. Independence & Ethics Disclosure

To maintain the trust of our readers, ScamReader operates under a strict Code of Ethics:

Editorial Independence: Our independent broker review methodology and ranking criteria is completely free from influence by brokers or any third parties. Our writers have zero contact with the sales or marketing departments of the brokers we review.

No “Pay-to-Play”: We do not accept payment to alter a broker’s rating. If a broker improves their service or gains a new license, they may request a re-review, which we will conduct with the same level of scrutiny as the original.

Conflict of Interest: Any affiliate links used on the site are clearly marked. More importantly, we do not affiliate with brokers who score below a 7/10 in our “Safety” category.

5. The “Instant Fail” Criteria (Red Flags)

A broker will receive an automatic “Scam” designation and a 0/10 score if they engage in any of the following:

1. Remote Access Requests: Asking a user to install AnyDesk or TeamViewer.

2. Guaranteed Returns: Promising “risk-free” profits or 100% success rates.

3. Cold Calling: Contacting individuals who never signed up for their services.

4. Crypto-Only Deposits: Only accepting untraceable payments like Bitcoin or USDT without a legitimate fiat alternative.

5. Recovery Scams: Contacting previous victims claiming they can “hack” the blockchain to get their money back for an upfront fee.

6. How to Use Our Broker Checker Tool

Our Broker Checker Tool is the culmination of this methodology. By entering a broker’s name or URL, you are accessing a live database of these checks.

Green Label (Verified): The broker holds reputable licenses and has a clean withdrawal history.
Yellow Label (Warning): The broker may be under any regulation or have a high volume of customer complaints. Proceed with extreme caution.
Red Label (Scam): Confirmed fraudulent activity. Do not deposit funds under any circumstances.

Conclusion: Empowering the Investor

At ScamReader, we believe that information is the best defense against financial predators. By documenting our methodology, we invite our readers to hold us(and the brokers we review) to the highest possible standard.

If you have been targeted by a broker or have information that contradicts one of our reviews, we encourage you to use our Report a Scam form. Your data helps us protect the next investor. While our broker review methodology and ranking criteria is reliable, it is not 100 percent accurate.