The Financial Industry Regulatory Authority has issued a warning about the risks involved with binary options trading. The alert comes in the wake of numerous calls the regulator has received through its Securities Helpline for Seniors – HELPS™. According to callers, there are business entities claiming to be binary options trading firms that are failing to deposit investors’ funds into their accounts, refusing to give investors back their money, or demanding a payment fee to make such a refund. One fraudster even purportedly pretended to be a regulator organization and demanded that investor pay money for taking part in an allegedly illegal binary options trading.
FINRA wants investors to be especially careful of non-US companies that offer binary options trading platforms, especially trading applications with names implying easy wealth, as well as demo accounts that give users a chance to try binary potions tradings without risking assets.
The self-regulatory organization said that these types of accounts may act as bait to get investors to ultimately fund a “real” account. Exposure to such accounts may also expose people to identity theft as they hand over personal information and other details.
Signs that the account you have opened for binary trading options may have been part of a scam include:
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You have been pressured to send more money.
• You have been subject to excuses for why gains cannot be credited to your account, your account cannot be closed, or the money from your account cannot be sent to you.
A huge part of the binary options market works via Internet-based trading platforms that may not comply with U.S. regulatory requirements. This can make illegal activity easier.
The Commodity Futures Trading Commission and the Securities and Exchange Commission also have received fraud complaints regarding websites that have offered to trade or purchase binary options via online-based trading platforms. Many of those complaints are related to a refusal to pay customers back their money or credit their accounts, software manipulation to create losing trades, and identity theft.
Contact our investment fraud law firm today. Binary options fraud can lead to investor losses.
FINRA Securities Helpline for Seniors – HELPS™
Binary Options: These All-Or-Nothing Options Are All-Too-Often Fraudulent, FINRA, October 26, 2015 (PDF)