Q&A

We get lots of questions every week. Some of them are simple to answer, others are more complicated. Some are deeply satisfying, others are almost unbearably depressing. Some just make us mad. Really, really mad at the abuse and mistreatment that some consumers are forced to endure.

A reader asked:

“What's is Forex Trading, and what experience does someone require to do.”

Forex is an abbreviation for “Foreign Exchange”, the process of exchanging one currency for another. Anyone who’s travelled will know the process. However, you’ll often see Forex being advertised as a way of making money. The idea they sell is very simple. Sign up on an online trading platform, send them money and you can start trading between various currencies, trying to buy some cheap and sell them if they improve in value.

It sounds simple but the truth is very different.

In fact Forex trading has the potential to ruin your finances. Another reader contacted us recently asking about one particular web site that offers to multiply (“leverage” is the technical term) your investment by up to 200 times, effectively giving you millions of Pula to trade with. What they neglect to tell their customers is that it works both ways. Yes, if you can correctly predict the fluctuations in the exchange rates between currencies you might make some money but they conveniently forget to tell you that it also means you can lose your entire “investment” in moments if the exchange rates go the other way. Within minutes of searching online I found stories of people who had lost over half a million Pula in moments trading Forex.

Another reader also asked us about a web site calling itself “23Traders”. He said that “they phone me everyday to invest on them, there is a guy who normally phones me telling me to deposit up to 10 000 US dollars so that I can make good profit”. Anyone who is that keen has an agenda they’re not telling you about. It’s curious that this company, who claim to be registered in Anguilla (an island in the Caribbean with a population half that of Ramotswa) and who claim to have a subsidiary in London were calling this reader from a number in Manchester.

The simple truth about Forex trading is that it’s a business full of suspicious characters. It’s a business that should be left entirely to the experts and that means experts such as banks and professional investment companies, not mere mortals like you and me.

My advice is only to trade Forex if you can afford to lose every thebe you invest instantly. If you care for your money, then think again.

Another reader asked the following question on our Facebook group.

“I have received a letter from RSA. The post stamps are from RSA and the envelope is addressed to my former address... with a pen. No letter head, but tempting contents. NO LETTER HEAD. Apparently a Mr X died in a plane crash in 1959 and FNB RSA CEO is looking for me to give me millions as I am an identified beneficiary. I hv to treat it urgently and confidently. Now i hv to send all my current particulars. Is it real?”

I’m sure most of you will instantly recognize this as a scam. The novelty is that this time it was an old-fashioned letter, not an email or a message on Facebook. I suspect that this particular scammer thinks it adds extra authenticity to the story he’s telling.

Of course what’ll happen is that in order to get these “millions” (which we all know don’t really exist) the victim will first be asked to send money to the scammers. They’ll claim it’s a legal fee, an account opening fee or sometimes even a bribe. Whatever it is, that’s what the scam is really all about. As with all scams, it’s about you giving them money, not them giving it to you.

Another question we got was about one of our old “favourites”, furniture stores. The reader said:

“I want to bring to ur attention the question of reasonability of furnished shops. Imagine buying a stove, fridge etc refurbished as new?!! This is happening herein Bots. Any refurbished item should be labeled as so and the price should reflect so as well. But I hardly see any item displayed and labeled accordingly. I can honestly say they do repair and refurbish so how come we never see the differences. What are u guys doing about this so we can pay for what is consciously?  Secondly some items on display like fridges tvs etc are they suppose to get the same price as a packaged product? If not how much discount?”

It’s an excellent question. It’s also one of the maddening ones.

The rules are actually very simple. Section 13 (1) (c) of the Consumer Protection Regulations says that a company “fails to meet minimum standards and specifications” if “representation is made that the commodity is new when in fact it has deteriorated, or it has been altered, reconditioned, used or is second hand”.

It can’t be simpler. If something has been refurbished (and there’s nothing wrong with that) then the store must make that clear to any prospective customer. The same goes for items that were returned by another customer, that were repossessed or that have been on display. They’re not new so they can’t be sold as if they were. It’s forbidden.

What a sensible store would do is offer second-hand, refurbished or returned items to new buyers at a discounted price. We all love a discount, don’t we?

And what are we doing about it? We’ll explain this in simple enough terms that even the simplest of store manager can understand it. Like I just did.