Content deleted Content added
Small format fix Tags: Reverted Mobile edit Mobile web edit |
m Dating maintenance tags: {{Non-primary source needed}} |
||
| (25 intermediate revisions by 20 users not shown) | |||
Line 5:
While binary options may be used in theoretical asset pricing, they are prone to [[fraud]] in their applications and hence banned by regulators in many jurisdictions as a form of [[gambling]].<ref name="Globes 12-15-16" /> Many binary option outlets have been exposed as fraudulent.<ref>{{Cite web |url=https://www.fbi.gov/news/stories/binary-options-fraud |title=Binary Options Fraud |website=Federal Bureau of Investigation |language=en-us |access-date=2017-05-30}}</ref> The U.S. [[Federal Bureau of Investigation|FBI]] is investigating binary option scams throughout the world, and the Israeli police have tied the industry to criminal syndicates.<ref name="FBI">{{cite news |last1=Weinglass |first1=Simona |authorlink=Simona Weinglass|title=FBI says it's investigating binary options fraud worldwide, invites victims to come forward |url=http://www.timesofisrael.com/fbi-says-its-investigating-binary-options-fraud-worldwide-invites-victims-to-come-forward/ |access-date=February 15, 2017 |work =[[The Times of Israel]] |date=February 15, 2017}}</ref><ref name="ToIidesofM"/><ref name=":1" /> The [[European Securities and Markets Authority]] (ESMA) has banned retail binary options trading.<ref name="esma.europa.eu">{{Cite web |url=https://www.esma.europa.eu/press-news/esma-news/esma-agrees-prohibit-binary-options-and-restrict-cfds-protect-retail-investors |title=ESMA agrees to prohibit binary options and restrict CFDs to protect retail investors |website=www.esma.europa.eu|access-date=2019-03-21}}</ref> [[Australian Securities & Investments Commission]] (ASIC) considers binary options as a "high-risk" and "unpredictable" investment option, <ref>{{Cite news |url=http://www.ibtimes.com.au/binary-options-trading-australia-how-safe-it-1568192 |title=Binary Options Trading In Australia: How Safe Is It? |date=2018-05-14 |work=International Business Times AU |access-date=2018-05-22 |language=en}}</ref> and finally also banned binary options sale to retail investors in 2021.<ref name="asic.gov.au">{{cite web |url=https://asic.gov.au/about-asic/news-centre/find-a-media-release/2021-releases/21-064mr-asic-bans-the-sale-of-binary-options-to-retail-clients|title=21-064MR ASIC bans the sale of binary options to retail clients |website=[[Australian Securities & Investments Commission]]|access-date=8 March 2022}}</ref>
The FBI estimates that the scammers steal US$10 billion annually worldwide.<ref name="TimesofI3417">{{cite news |last1 =Weinglass |first1=Simona |title=As Israel-based financial fraud soars, police swoop on 20 suspects as part of global, FBI-led sting |url= http://www.timesofisrael.com/as-israel-based-financial-fraud-soars-police-swoop-on-20-suspects-as-part-of-global-fbi-led-sting/ |access-date=March 4, 2017 |work=The Times of Israel |date=March 4, 2017}}</ref> The use of the names of famous and respectable people such as [[Richard Branson]]
On January 30, 2018, [[Facebook]] banned advertisements for binary options trading as well as for [[cryptocurrencies]] and [[initial coin offering]]s (ICOs).<ref name="blomm13018">{{cite news |last1=Frier |first1=Sarah |last2=Verhage |first2=Jules |title=Facebook Bans Ads Associated With Cryptocurrencies |url=https://www.bloomberg.com/news/articles/2018-01-30/facebook-bans-ads-associated-with-bitcoin-cryptocurrencies |access-date=February 7, 2018 |work =Bloomberg |date=January 30, 2018}}</ref><ref name="FT013018">{{cite news |last1=Cornish |first1=Chloe |title=Facebook and regulators move to halt cryptocurrency scams |url=https://www.ft.com/content/9c1050ca-05f8-11e8-9650-9c0ad2d7c5b5 |archive-url=https://ghostarchive.org/archive/20221210/https://www.ft.com/content/9c1050ca-05f8-11e8-9650-9c0ad2d7c5b5 |archive-date=2022-12-10 |url-access=subscription |access-date=February 7, 2018 |work =[[Financial Times]]|date=January 30, 2018}}</ref> [[Google]] and [[Twitter]] announced similar bans in the following weeks.<ref name="EU1">{{cite news |title=European Union bans binary options, strictly regulates CFDs |url=https://www.timesofisrael.com/european-union-bans-binary-options-strictly-regulates-cfds/ |last1=Weinglass |first1=Simona |date=March 28, 2018 |access-date=March 21, 2019 |publisher=The Times of Israel}}</ref>
Line 136:
=== France ===
In August 2016, France's [[Law on transparency, the fight against corruption and the modernization of economic life|''Sapin II'' bill on transparency]] was announced by the [[Autorité des marchés financiers (France)|Autorité des Marchés Financiers]] (AMF), seeking to outlaw all financial derivatives advertising. The AMF stated that it would ban the advertising of certain highly speculative and risky financial contracts to private individuals by electronic means.<ref>{{citation|type=press release|title=Ban on the advertising of forex products, binary options and some CFDs: AMF launches consultation on changes to its General Regulation|date=August 1, 2016|work=Autorité des Marchés Financiers|url=http://www.amf-france.org/en_US/Actualites/Communiques-de-presse/AMF/annee-2016.html?docId=workspace%3A%2F%2FSpacesStore%2Fad42eecc-9720-49da-82a8-2ddcb72fbf1d|access-date=January 15, 2017|archive-url=https://web.archive.org/web/20190617015956/https://www.amf-france.org/en_US/Actualites/Communiques-de-presse/AMF/annee-2016.html?docId=workspace%3A%2F%2FSpacesStore%2Fad42eecc-9720-49da-82a8-2ddcb72fbf1d|archive-date=June 17, 2019|url-status=dead}}</ref><ref>{{cite news |url=http://financefeeds.com/ig-group-officially-responds-french-fx-cfd-advertising-ban/ |title=IG Group officially responds to French FX and CFD advertising ban |work=Finance Feeds |date=9 January 2017 |author=Andrew Saks-McLeod |access-date=18 May 2017 |archive-date=3 September 2017 |archive-url=https://web.archive.org/web/20170903034136/https://financefeeds.com/ig-group-officially-responds-french-fx-cfd-advertising-ban/ |url-status=dead }}</ref> The document applies specifically to binary options, and to [[contracts for difference]] (CFDs), and financial contracts on currencies. The French regulator is determined to cooperate with the legal authorities to have illegal websites blocked.<ref>{{cite news|url=http://financefeeds.com/breaking-amf-toughens-stance-advertising-following-public-consultation/|title=AMF toughens its stance on advertising following public consultation|work=Finance Feeds|date=10 January 2017|author=Maria Nikolova|access-date=18 May 2017|archive-date=7 May 2017|archive-url=https://web.archive.org/web/20170507140401/http://financefeeds.com/breaking-amf-toughens-stance-advertising-following-public-consultation/|url-status=dead}}</ref> The law also prohibits all forms of sponsorship and partnership that results in direct or indirect advertising of the financial products it covers. This ban was seen by industry watchers as having an impact on sponsored sports such as European football clubs.<ref>{{citation|title=French football clubs rush to terminate binary options partnerships|quote=Under Article 77 of the Sapin II law, football teams have until the end of June this year to terminate all sponsorships|author=Maria Nikolova|work=Finance Feeds|url=http://financefeeds.com/french-football-clubs-rush-terminate-binary-options-partnerships/|access-date=2017-01-15|archive-date=2019-06-17|archive-url=https://web.archive.org/web/20190617015948/https://financefeeds.com/french-football-clubs-rush-terminate-binary-options-partnerships/|url-status=dead}}</ref>
The Cyprus-based company 24Option<ref>{{Cite web|url=https://cyprusregistry.com/companies/EE/41700|title=24OPTION - Cyprus Business Name - CyprusRegistry.com|website=cyprusregistry.com|access-date=2019-04-17}}</ref> was banned from trading in France by AMF earlier in 2016.<ref>{{citation|type=press release|title=L'Autorité des marchés financiers interdit à Rodeler Limited (" 24option ") de fournir des services sur le territoire français|trans-title=Autorité des Marchés Financiers halts Rodeler Limited ("24option") activities in France|date=July 29, 2016|publisher=Autorité des Marchés Financiers|url=http://www.amf-france.org/Actualites/Communiques-de-presse/AMF/annee-2016.html?docId=workspace%3A%2F%2FSpacesStore%2Ff35a247e-e20d-42c3-8b3d-b354794a2a70|access-date=January 15, 2017|archive-url=https://web.archive.org/web/20190617015955/https://www.amf-france.org/Actualites/Communiques-de-presse/AMF/annee-2016.html?docId=workspace%3A%2F%2FSpacesStore%2Ff35a247e-e20d-42c3-8b3d-b354794a2a70|archive-date=June 17, 2019|url-status=dead}}</ref> They had sponsored a well-known Irish [[mixed martial arts|mixed martial artist]], [[Conor McGregor]], who in turn promoted the company through social media.<ref>{{citation|title=Conor McGregor sponsor barred from operating in France|work=Irish Times|date=November 19, 2016|author=Barry O'Halloran|url=http://www.irishtimes.com/business/media-and-marketing/conor-mcgregor-sponsor-barred-from-operating-in-france-1.2874175}}</ref>
Line 145:
=== Indonesia ===
According to the Commodity Futures Trading Regulatory Agency (CoFTRA) in Indonesia, also known as BAPPEBTI, binary options are considered a form of online gambling and is illegal in the country. The move to delegalize binary options stems from concerns that the public may be swayed by misleading advertisements, promotions, and offers to participate in fraudulent practices that operate under the guise of binary options trading.<ref>{{Cite web|last=Dirgantara|first=Hikma|date=2022-02-03|title=Bappebti Blokir 92 Entitas Binary Option di 2021, Termasuk Binomo, IQ Option|url=https://investasi.kontan.co.id/news/bappebti-blokir-92-entitas-binary-option-di-2021-termasuk-binomo-iq-option|access-date=2022-02-07|website=Kontan.co.id|language=id}}</ref> As of 2 February 2022, at least 92 binary options websites, including Binomo, [[IQ Option]], and Olymp Trade, have been classified as unlicensed operators and blocked by the Indonesian government.<ref>{{Cite web|date=2022-02-04|title=Indonesian regulators block illegal trading websites following complaints on social media|url=https://kr-asia.com/indonesian-regulators-block-illegal-trading-websites-following-complaints-on-social-media|access-date=2022-02-07|website=KrASIA|language=en}}</ref>
=== Israel ===
Line 152:
;Fraud
In 2016 ''[[The Times of Israel]]'' ran several articles on binary options fraud. "The wolves of Tel Aviv: Israel's vast, amoral binary options scam exposed" revealed that the industry is a scam.<ref name="israeltimes1" /> A second article describes in detail how a binary options salesman fleeced clients. "According to one ex-employee of a firm that employs over 1,000 people in a high-rise office building in [[Tel Aviv]], losses are guaranteed because the 'dealing room' at the binary options firm controls the trading
In July 2016 the Israeli binary option firms Vault Options and Global Trader 365 were ordered by the [[United States District Court for the Northern District of Illinois|U.S. District Court for the Northern District of Illinois]] to pay more than $4.5 million for unlawful off-exchange binary options trading, fraud, and registration violations. The companies were also banned permanently from operating in the United States or selling to U.S. residents.<ref>{{cite news|url=http://www.cftc.gov/PressRoom/PressReleases/pr7414-16|title= Federal Court Orders Israeli Web-based Firms, Vault Options, Ltd. and Global Trader 365, to Pay More than $4.5 Million for Unlawful Off-Exchange Binary Options Trading, Fraud, and Registration Violations|date=July 28, 2016|publisher=Commodities and Futures Trading Commission}}</ref>
Line 164:
In September 2017, the FBI arrested Lee Elbaz, CEO of binary options trading company Yukom Communications, upon her arrival in the United States. They arrested her for [[wire fraud]] and conspiracy to commit wire fraud.<ref name="Matts092417">{{cite news |last1=Staff|first1=Tori|title=FBI arrests Israeli binary options CEO as she disembarks El Al flight at JFK|url=https://www.timesofisrael.com/fbi-arrests-israeli-binary-options-ceo-as-she-disembarks-el-al-flight-at-jfk/|work =The Times of Israel|date=September 24, 2017|access-date=September 24, 2017}}</ref> In 2019, Lee Elbaz was found guilty and sentenced to 22 years in prison.<ref>{{cite news |title=Former CEO of Israeli Company Sentenced to 22 Years in Prison for Orchestrating Major International Binary Options Fraud Scheme|url=https://www.justice.gov/opa/pr/former-ceo-israeli-company-sentenced-22-years-prison-orchestrating-major-international-binary/|work =Department of Justice|date=December 19, 2019|access-date=August 19, 2022}}</ref>
In February 2019, the FBI arrested Austin Smith,
===Malta===
Line 188:
In the United States, the [[Securities and Exchange Commission]] (SEC) approved [[Exchange-traded product|exchange-traded]] binary options in 2008.<ref>{{Cite news|url=https://www.reuters.com/article/companyNewsAndPR/idUSN0943920080609|title=CBOE to list binary options on S&P 500, VIX |last=Frankel |first = Doris |date=June 9, 2008 | publisher=[[Reuters]] | access-date=December 8, 2018}}</ref> Trading commenced on the [[NYSE American]] (MYSEA) and the [[Chicago Board Options Exchange]] (CBOE) in May and June 2008.<ref name=leapinfo>{{cite web | url=https://www.leaprate.com/news/the-history-of-binary-options-trading-infographic/ | title=The History of Binary Options Trading – Infographic | date=January 5, 2017 | website=leaprate.com | access-date=December 8, 2018}}</ref>
The MYSEA offers binary options on some [[exchange-traded fund]]s and a few highly liquid equities such as [[Citigroup]] and [[Google]]. On the exchange binary options were called "fixed return options" (FROs). To reduce the threat of [[market manipulation]] of single stocks, FROs use a "settlement index" defined as a volume-weighted average of trades on the expiration day. MYSEA and [[Donato A. Montanaro]] submitted a [[patent application]] for exchange-listed binary options using a volume-weighted settlement index in 2005.<ref>[
[[Nadex|NADEX]], a U.S.-based [[Commodity Futures Trading Commission]] (CFTC) regulated exchange, launched binary options for a range of [[Forex]], [[Commodity#Commodity trade|commodities]], and [[stock indices]]' markets in June 2009,.<ref>{{cite web|url=http://www.nadex.com/content/files/pressrelease-01.pdf|title=Nadex, North American derivatives exchange rolls out new trading platform, products|date=June 22, 2009|publisher=[[Nadex]]|archive-url=https://web.archive.org/web/20120401080606/http://www.nadex.com/content/files/pressrelease-01.pdf|archive-date=April 1, 2012|access-date=December 8, 2018}}</ref> On March 30, 2010 the CFTC issued an amended Order of Designation to allow trades on NADEX to be intermediated.<ref>{{Cite web|url=https://sirt.cftc.gov/SIRT/SIRT.aspx?Topic=TradingOrganizationsAD&Key=34536|title=- CFTC|website=sirt.cftc.gov|access-date=2019-03-21}}</ref> NADEX have since offered binary options trading between buyers and sellers. They do not participate in the trades.<ref>{{Cite web|url=https://www.nadex.com/why-nadex/regulated-and-legal-for-us-residents|title=Regulated & Legal for US Residents|date=2015-09-24|website=Nadex|language=en|access-date=2019-03-21}}</ref>
Line 219:
== External links ==
*[
*[https://www.cftc.gov/ConsumerProtection/FraudAwarenessPrevention/CFTCFraudAdvisories/fraudadv_binaryoptions.html CFTC investor alert]
*{{cite news|last1=Levy-Weinrib|first1=Ela|title=Regulator seeks blanket binary options ban|url=http://www.globes.co.il/en/article-regulator-seeks-blanket-binary-options-prohibition-1001175186|access-date=May 6, 2018|publisher=[[Globes (newspaper)|Globes]] English|date=February 2, 2017}}
| |||