Binary options — a yes/no position on a future market condition — can be traded on registered U.S. exchanges. But there are many other websites, social media posts, advertisem*nts or online videos that promote unregistered binary options trading platforms. Many times these platforms are operated by offshore companies that are committing fraud. Learn how these frauds work and how to protect yourself.
Fraud Advisory
CFTC and SEC Warn Customers about Fraudulent Schemes
Many online binary option trading platforms operate in violation of the law. Some of these unregistered platforms have refused to credit customer accounts, denied fund reimbursem*nt, committed identity theft, and manipulated their software to generate losing trades for customers.
Conduct a Registration Check
Visit the National Futures Association BASIC Database
BASIC is a free tool you can use to check the registration status and disciplinary history of a derivatives professional or company. Conduct a check before you invest.
Take Action
If you have been victimized by an unregistered binary options trading platform, or if you have information about a violation of the Commodity Exchange Act or CFTC regulations, submit your tip here.
Videos
The Truth Behind Binary Options Fraud, Episode 1: Dissecting the Scam
How does binary options fraud work? How can you recognize and avoid it? And what should you do if you suspect you’re being defrauded? We answer these questions and talk to real investors in the first episode of our series, The Truth Behind Binary Options Fraud.
The Truth Behind Binary Options Fraud, Episode 2: Fraud on a Global Scale
When Nick and Lowell tried to withdraw money from their allegedly insured binary options trading accounts, they hit a wall. Watch their stories to learn the telltale signs of binary options fraud, so you can steer clear.
Articles
Avoid Unregistered Binary Options Trading Platforms
Lowell Enlow was a contractor for NASA and later operated several insurance agencies throughout Florida. Nick Morrison is a store manager in Central Illinois. Despite their years of investing and financial experience, both men were victims of a sophisticated online fraud.
Unregistered Binary Options Trading Websites Can Snare Savvy Investors
It’s perfectly normal for investors to test out new strategies. But be careful. There are seemingly “easy” or “low-cost” or “low-risk” offers popping up online that are actually frauds designed to drain money from investors’ accounts.
Beware of Binary Options Mobile Apps
Mobile apps make finance more convenient, but some binary option trading apps may be linked to unregistered offshore platforms. Here’s what to watch for.
RED List
Foreign entities that have been identified as acting in a capacity that appears to require registration but are not appropriately registered with the CFTC.
