More Proof That Banning Binary Options Doesn’t Work

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More Proof That Banning Binary Options Doesn’t Work

The Regulators Keep Fighting But The Scams Don’t Stop

Binary options regulators keep fighting fraud but the scams just don’t stop popping up. To emphasize this point the Belgian regulator FSMA revealed some data that shows just how pervasive fraud, not just binary options fraud, can be. Their data shows the number of complaints rose by 13% in Belgium for all of 2020. Surprisingly, the data also shows that banning binary options doesn’t work. The regulator says that since their ban went into place the number of complaints against binary options scams has gone up, not down.

The regulator revealed that it had received a total of 1,710 calls last year and of those nearly 800 involved some form of scam. Topping the list are pyramid schemes at 169 followed by binary options at 164 calls and boiler room scams at 112. Surprisingly, there were only 33 calls related to cryptocurrency but that is likely to change in 2020. Cryptocurrency has become a new focus of financial scammers.

CONSOB Issues New Warnings

Italy’s financial watchdog, CONSOB, has issued a new round of warnings. Unsurprisingly, many of the names on the list have been warned by other EU nations in the past. Firms on the new list include iForex24.com, Toroptions (operated by SmartChoice LTD) and Tradex1.com, none of which have authorization to operated brokerages or offer financial services within Italy.

CONSOB has also suspended all advertising for a company by the name of Five Winds Asset Managment. The suspension is for 90 days and will be lifted if the company can comply to regulatory requirements. The suspension was put into place because the company was offering services in and/or to Italians without the proper regulation or licensing.

ASIC Bans Managed Account Scammers

Australia’s ASIC has banned for life two operators of a binary options managed account scam. The scam involved Jana Jaros and Jackson Lawrence Malcom Capper who were both convicted of the fraud. The two set up managed accounts with binary options brokers using fake names and then defrauded clients of their money. To make matters worse they reinvested early gains into staff and offices from which they launched new frauds.

The two claimed experienced traders would manage accounts for clients after selling them a service that cost upwards of $3,000. Charges resulted in convictions on at least two charges, financial fraud and lodging false information, both of which carry jail time. Full term for both charges is up to 7 years and $76,000 in penalties.

Trading Volume In Japan Surges

New data reveals that binary options trading volume has surged in Japan. The Financial Futures Association of Japan says trading volume surged nearly 30% in the month of January and is up more than 10% from the prior year. The data shows, that while the market is still a bit shaky, that public perception of the financial product is improving.

More Proof That Banning Binary Options Doesn’t Work

The Regulators Keep Fighting But The Scams Don’t Stop

Binary options regulators keep fighting fraud but the scams just don’t stop popping up. To emphasize this point the Belgian regulator FSMA revealed some data that shows just how pervasive fraud, not just binary options fraud, can be. Their data shows the number of complaints rose by 13% in Belgium for all of 2020. Surprisingly, the data also shows that banning binary options doesn’t work. The regulator says that since their ban went into place the number of complaints against binary options scams has gone up, not down.

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  • BINOMO
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    2nd place in the ranking!

The regulator revealed that it had received a total of 1,710 calls last year and of those nearly 800 involved some form of scam. Topping the list are pyramid schemes at 169 followed by binary options at 164 calls and boiler room scams at 112. Surprisingly, there were only 33 calls related to cryptocurrency but that is likely to change in 2020. Cryptocurrency has become a new focus of financial scammers.

CONSOB Issues New Warnings

Italy’s financial watchdog, CONSOB, has issued a new round of warnings. Unsurprisingly, many of the names on the list have been warned by other EU nations in the past. Firms on the new list include iForex24.com, Toroptions (operated by SmartChoice LTD) and Tradex1.com, none of which have authorization to operated brokerages or offer financial services within Italy.

CONSOB has also suspended all advertising for a company by the name of Five Winds Asset Managment. The suspension is for 90 days and will be lifted if the company can comply to regulatory requirements. The suspension was put into place because the company was offering services in and/or to Italians without the proper regulation or licensing.

ASIC Bans Managed Account Scammers

Australia’s ASIC has banned for life two operators of a binary options managed account scam. The scam involved Jana Jaros and Jackson Lawrence Malcom Capper who were both convicted of the fraud. The two set up managed accounts with binary options brokers using fake names and then defrauded clients of their money. To make matters worse they reinvested early gains into staff and offices from which they launched new frauds.

The two claimed experienced traders would manage accounts for clients after selling them a service that cost upwards of $3,000. Charges resulted in convictions on at least two charges, financial fraud and lodging false information, both of which carry jail time. Full term for both charges is up to 7 years and $76,000 in penalties.

Trading Volume In Japan Surges

New data reveals that binary options trading volume has surged in Japan. The Financial Futures Association of Japan says trading volume surged nearly 30% in the month of January and is up more than 10% from the prior year. The data shows, that while the market is still a bit shaky, that public perception of the financial product is improving.

FCA imposes bonus ban and leverage cap for CFDs

  • Post # 42
  • Quote
  • Dec 6, 2020 2:11pm Dec 6, 2020 2:11pm

So all of a sudden the FCA cares about retail traders losing money, but what happens in the market if traders dont lose money?

They need losers.

  • Post # 43
  • Quote
  • Dec 6, 2020 2:17pm Dec 6, 2020 2:17pm
  • Post # 44
  • Quote
  • Dec 6, 2020 2:24pm Dec 6, 2020 2:24pm

Usually you can qualify as a professional trader (it’s a MiFid concept as far as I know) and some more professional brokers will only work with you if you are.

Edit: some brokers also ask you for your trading style to create a risk profile and set your maximum leverage accordingly and to be fair, limiting leverage for people who like to keep positions open over the weekend is only fair – the broker has to protect his own arse. Claiming big sums from under financed retailers is nearly impossible.

  • Post # 45
  • Quote
  • Dec 6, 2020 2:43pm Dec 6, 2020 2:43pm

i am truly all in for all the above.
almost sounds like the (almost fair) trading ground of stock market.

only i am afraid, that when all these points met, so will the conditions change too, between 1-5x max leverage, just as most stock markets offer.
with no brokers taking the other side of my trade, or manipulate my price feed, slippage, execution, and whatever i might not even think about. the playing ground should level nicely.
maybe a price to pay.

  • Post # 46
  • Quote
  • Dec 6, 2020 3:13pm Dec 6, 2020 3:13pm
  • Post # 47
  • Quote
  • Dec 6, 2020 4:02pm Dec 6, 2020 4:02pm

I think it’s a good news rather than a bad one. It is the fact that most traders who don’t know risk management destroy their account by using high leverage on trading. I risk 1-2% of balance per trade and it’s only using 5-10 leverage. Though somebody trades with narrow stop loss and larger lot size, 50 leverage is more than enough.

Some traders are talking about the risks of puting more money online with lower leverage. If you believe FCA regulator you will know that your money is under protection of FSCS for �50,000, and there are FCA brokers offering insurance for �500,000, it is more than enough for most traders. If you don’t believe FCA you can still choose brokers with other regulations who offer high leverage.

It really affects some traders anyway, but it will surely protect more. I think it is more than a descester for market making brokers.

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