The world of investment and trading is replete with scammers and fraudulent brokers. The absence of a central regulatory authority for some financial products, such as binary options, makes it particularly easy for fraudsters to run operations on the internet.
Unregistered brokers create a stellar trading platform equipped with advanced technology and promise high returns to investors. Nothing seems unusual until you try to withdraw your funds, and are told that you need to pay more taxes, commissions, transfer fees, etc.
That’s when things start spiraling into an unending nightmare and you realize you’ve been scammed. While binary options scam recovery is possible, it requires the help of an experienced recovery specialist who is equipped to identify and confront the scammer, and get your money back.
Even though binary options have existed for many decades, there’s been an onslaught of scammers trying to dupe unsuspecting investors of their hard-earned money. In some cases, people have even lost their entire life savings to such scams.
Apart from binary options, fraud is equally prevalent in other forms of trading, including cryptocurrency and forex.
Over the last two years, there’s been a slew of lawsuits filed against fraudulent investment brokers and trading companies operating out of Israel. Most of these scammers engaged in the selling of binary options and other financial instruments.
The lawsuits have been filed by victims from several countries, including the U.S., U.K. Australia, Germany, Ireland, Sweden, Italy, Singapore, and Japan.
In some cases, the plaintiffs are in their 50s, and have lost their entire retirement savings to these scams. While in some cases, the lawsuits were settled in court and the defendants agreed to compensate the victims, most lawsuits are still ongoing.
The plaintiffs often have to withdraw their lawsuit and sign an agreement of non-disclosure as part of the settlement. But in none of the cases, has the court ever ordered a trial or criminally prosecuted the alleged scammers.
It’s worth pointing out that while the fraudsters were operating in Israel, they’d managed to dupe people from across the world. It highlights how wary you should be about depositing your money to a binary options trading platform.
Also, what’s worth noting is that individual scammers aren’t the only ones out to rip you off.
In April 2021, the Securities and Exchange Commission filed a complaint against Spot Tech House Ltd. (previously known as Spot Option Ltd.) and its top executives, Pini Peter and Ran Amiran.
The company, which duped retail investors out of more than $100 million, was based out of Israel. They engaged in the fraudulent selling and trading of binary options investments. They’d even developed a proprietary trading platform that was manipulated to minimize the chances of an investor winning a trade.
The SEC has also filed a spate of complaints against companies and individual brokers who have engaged in unauthorized selling of binary options through the Spot Option platform.
The binary options trading landscape will continue to be risky and volatile. But if you’re willing to try your hands at it, here are a few lessons from the previously mentioned scams that you should keep in mind:
You read that right. It’s because most of the fraudulent brokers and investment advisers create fake identities. They never reveal their real name, contact number, and country of operation. Worse still, they might create fake license and registration numbers.
That makes it painstakingly difficult to identify and trace these scammers once they start ghosting you.
Even if you manage to track down the scammer, filing a lawsuit in a foreign country is complicated. It involves hefty fees too. People who’ve just lost their life savings to a scam may not be in a position to afford the legal fees.
In such cases, a more suitable alternative is to reach out to a binary options scam recovery specialist who will help track the real identity of the scammer, irrespective of where they’re located.
That’s the thumb-rule for any new type of financial instrument you try. It’s even more crucial considering the volatility of binary options trading. Don’t go all-in with everything you’ve saved up for your retirement. Instead, invest small amounts of money that you wouldn’t mind losing.
Check whether the broker is registered with a reputable regulatory body, such as the SEC or Commodity Futures Trading Commission (CFTC). Ask for their license number and proof of identification. Also, avoid signing up on trading platforms that are headquartered overseas.
Whether you’re an experienced trader or a novice, the next binary options scam could come knocking at your door anytime. The best way of avoiding scammers is to inform yourself about the newest trading strategies and trends. Also, ask questions about the broker’s identity, license, existing clients, etc. Don’t forget to check the payout terms as well.