In the world of online trading, brokers are expected to provide accurate, real-time price feeds sourced from reputable liquidity providers. However, a growing number of dishonest brokers have been caught engaging in the internal price generator scam—a deceptive practice where price feeds are fabricated or manipulated in-house, giving the illusion of market movement while isolating traders from the real market.

This scheme allows brokers to control price direction, widen spreads on demand, and trigger stops or margin calls without justification, all while claiming technical legitimacy.

What Is an Internal Price Generator?

An internal price generator is a software tool embedded within the broker’s trading platform that simulates market pricing without relying on live feeds from banks or external liquidity providers. Instead of quoting prices from the interbank market, the broker generates its own stream of prices based on internal algorithms.

While some level of price aggregation or smoothing is acceptable for execution quality, an entirely fabricated price feed is a serious violation of trader trust and regulatory obligations.

How the Scam Works

1. Platform Runs on Broker-Controlled Prices

The broker’s MT4, MT5, or proprietary platform displays prices that are not synced with any known financial data source. These prices are:

• Slightly delayed or offset from real market quotes
• Designed to follow general market trends but with key differences
• Often feature unexplained spikes or drops
• Unique to the broker, making them unverifiable elsewhere

2. Price Patterns Are Rigged to Trigger Trader Losses

The fabricated feed allows the broker to:

• Artificially widen spreads during key moments (e.g. news events)
• Create fake spikes to hit stop losses or margin out positions
• Suppress breakouts or prevent price reaching take profit levels
• Avoid proper order execution by manipulating the feed around trader entries

3. Broker Claims to Use a “Proprietary Liquidity Engine”

When questioned, the broker insists the pricing is legitimate, using language like:

“Our prices are sourced from our proprietary liquidity hub.”
“We aggregate from multiple Tier-1 providers for optimal execution.”
“Minor differences in price reflect our unique risk model.”

In reality, there’s no proof of external data sourcing, and no transparency around pricing logic.

4. Traders Cannot Compare or Verify the Price Feed

Since the broker’s feed is fabricated:

• Traders can’t verify price moves on TradingView, Bloomberg, or Reuters
• Chart patterns, support/resistance levels, and indicators behave differently
• Even if the trade setup is technically perfect elsewhere, it fails on this platform

This isolation prevents traders from applying sound strategies and leads to confusion, frustration, and consistent losses.

Real Case: Stop Loss Hit on Broker’s Platform Only

A trader places a stop loss at 1.25600 on GBP/USD. Price touches 1.25630 on major platforms like TradingView and FXCM—but on the broker’s platform, a sudden 10-pip spike appears only on their feed, closing the trade. When asked for proof, the broker replies:

“Our liquidity provider recorded this spike due to volatility. This is not an error.”

No explanation is provided, and the price spike cannot be found anywhere else.

Why This Scam Is So Dangerous

The internal price generator scam undermines the entire foundation of trading. It:

• Decouples traders from real market pricing
• Invalidates technical and price action strategies
• Gives brokers total control over profit and loss outcomes
• Destroys trader confidence in data, execution, and risk management

It is especially dangerous for scalpers, EA users, and traders relying on price accuracy.

How to Detect Internal Price Feed Manipulation

1. Cross-Check Price Action in Real Time
Compare your broker’s prices to:

• TradingView
• MetaQuotes live demo
• Tier-1 brokers like Pepperstone or IC Markets
• Financial news platforms (Bloomberg, Investing.com)

Any unexplained deviation of 3–5 pips or more is a red flag.

2. Look for Phantom Wicks or Spikes
Fake price spikes (that don’t exist on other platforms) are strong evidence of feed manipulation. Take screenshots and document timestamps.

3. Observe Suspicious Price Reversals

If breakouts consistently fail only on your platform while succeeding elsewhere, the price feed may be internally managed.

4. Ask the Broker to Confirm Their Liquidity Providers

Demand a list of actual liquidity partners and the location of their pricing engine. Vague answers like “global hubs” or “Tier-1 aggregators” without names are likely a cover-up.

5. Use a Demo Account as a Benchmark

Test identical trades across demo and live environments. If outcomes differ significantly, investigate the data source integrity.

What Reputable Brokers Do Differently

Legitimate brokers:

• Disclose pricing sources openly
• Use third-party bridge providers (e.g. PrimeXM, OneZero)
• Allow trade audits and log exports
• Do not manipulate spreads or feeds without warning

If a broker cannot meet these standards, your trades are at risk before you even click “Buy.”

Regulatory Action and Rights

Regulatory bodies like the FCA, ASIC, and CySEC require brokers to:

• Provide transparent, verifiable execution prices
• Offer clear disclosure of data sources
• Honour best execution practices for retail clients

Using an internal price generator without proper disclosure could lead to fines, licence suspension, or client compensation orders.

Conclusion: Real Trades Need Real Prices

The internal price generator scam is one of the most dangerous forms of digital manipulation in trading. It severs your access to the real market and leaves your outcomes in the hands of a script you cannot see or challenge. Without a live, verified price feed, you are not trading—you’re gambling against a rigged screen.

To learn how to verify broker integrity, validate pricing data, and protect your trades from hidden manipulation, join our advanced Trading Courses, designed to give retail traders the tools to thrive in the real markets—not broker simulations.