The efforts of regulators to curb fraudulent practices within the binary options industry are beginning to work. There are less and less scammy brokers every day, they use less and less aggressive/fraudulent tactics to lure in the unsuspecting and there are less and less cases of fraud. The bad news is that it has also taken a toll on legitimate brokers too. Those brokers who’ve been tainted by the brush of guilt by association and those who just don’t see a future with binary.
The latest victim is Lionsman Capital Markets, a Cypress Investment Firm, an operator of binary options and forex trading websites. The company was fined by CySEC earlier this year which has resulted in them renouncing their license and closing their doors. This does not however mean that the brokerages will be closing as both arms of the business were sold off as part of the CySEC settlement. There is however this to consider, Optionweb.com has switched to CFD trading and left binary behind. For those not familiar with CFD’s they are a trading contract that profits on the movement of the underlying asset much the same as binary; if you buy and the asset moves up you win, if it moves down you lose and the opposite for bearish positions.
Anyoption Other Than Binary?
AnyOption has also gone the way of the wild buffalo, at least where binary options are concerned. The company was recently purchased/merged with the forex trading website Invest.com. Invest.com is focused on offering forex trading solutions to the retail trading crowd, the addition of Anyoption will allow it to offer binary-like CFD trading to its customers as well. Invest.com is seen to receive many benefits to the deal including access to Anyoption’s list of clients, a network of global financial licenses including CySEC and South Africa, a vetted compliance scheme and Anyoptions established tech/marketing infrastructure. Benefits to us binary options traders? The option, no pun intended, to switch to CFD trading.
And The Warnings Keep Coming
And through it all the warnings keep coming. Bottom line, it’s not good to operate a binary options brokerage, signal service, robot or management company without the proper licensing. The UK’s FCA has warned against two brands recently, AIG Options and CMC Options. These two binary options brokerages are or were operating in the UK without a license and further, were using underhanded and black hat techniques to lure in customers. Included in the charges are statements outlining how the names AIG Options and CMC Options are similar to existing and legitimate businesses in order to confuse and mislead the public. The two businesses are also suspected of being run by the same parent.
Australia’s ASIC is also working to protect its citizens. The regulator has issued another warning about broker BinaryTilt.com. The broker has been soliciting Australian clients without a license and may be, according the statement, a scam. Likewise, the New Zealand regulator has warned against Stern Binary Options due to a number of complaints along with the fact it is not regulated. The French AMF is also still actively warning against fraud brokers and has added at least a dozen names over the summer. Their problem is that fraud brokers close shop and reopen the next day with a new name. Sources: FinanceMagnates, LeapRate.