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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]] to encourage people to buy fake "investments" is frequent and increasing.<ref name=branson>{{cite news |url= https://www.theguardian.com/business/2017/may/17/richard-branson-virgin-says-scammers-are-using-his-name-to-dupe-investors |title=Richard Branson says scammers are using his name to dupe investors |work =The Guardian |date=18 May 2017 |author=Press Association |access-date= 18 May 2017}}</ref> Articles published in ''[[The Times of Israel]]'' newspaper explain the fraud in detail, using the experience of former insiders such as a job-seeker recruited by a fake binary options broker, who was told to "leave [his] conscience at the door".<ref name="israeltimes1"/><ref name="israeltimes2"/> Following an investigation by ''The Times of Israel'', [[Cabinet of Israel|Israel's cabinet]] approved a ban on sale of binary options in June 2017,<ref>{{citation |title=Israel cabinet approves ban on sale of binary options |work =Reuters |author=Tova Cohen |date=June 18, 2017 |url=https://www.reuters.com/article/us-israel-binaryoptions-lawmaking-idUSKBN19906C |access-date=2017-07-15}}</ref> and a law banning the products was approved by the [[Knesset]] in October 2017.<ref name="AtLast">{{cite news |last1=Weinglass |first1=Simona |title=Israel bans binary options industry, finally closing vast, 10-year fraud |url=https://www.timesofisrael.com/israel-bans-entire-binary-options-industry-finally-closing-vast-10-year-fraud/ |access-date=October 24, 2017 |publisher=[[The Times of Israel]] |date=October 23, 2017}}</ref><ref name="Knesset ban 10-24-17">{{Cite news |url=https://www.haaretz.com/israel-news/business/1.818782 |title=Israel Bans Binary Options Industry That Defrauded Millions |last=Tomer |first=Uri |date=2017-10-24 |work=Haaretz |access-date=2017-10-24 |language=en}}</ref>
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>
==Function==
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===United Kingdom===
;Binary options trading
In the UK, binary options were regulated by the [[Gambling Commission]] rather than the [[Financial Conduct Authority]] (FCA).<ref name=ftfca>{{cite web | url=https://www.ft.com/content/d493d457-9d93-3b9f-9d05-a09774f4b95a |archive-url=https://ghostarchive.org/archive/20221210/https://www.ft.com/content/d493d457-9d93-3b9f-9d05-a09774f4b95a |archive-date=2022-12-10 |url-access=subscription | title=FCA warns on illegal binary options providers | date=January 12, 2018 | last=Murphy | first=Hannah | newspaper=[[Financial Times]] | access-date=December 8, 2018}}{{subscription}}</ref> This regulation, however, applied only to firms that have gambling equipment in the UK.<ref name=ftadvisor2017>{{cite web|url=https://www.ftadviser.com/investments/2017/11/15/fca-warns-investors-against-binary-options/ | title=FCA warns investors against binary options | date=November 15, 2017 | last=Fantato|first=Damian|website=FTAdviser|access-date=December 8, 2018}}</ref> The FCA in 2016 did propose bringing binary options under its jurisdiction and restricting them. They stated that binary options "did not appear to meet a genuine investment need".<ref name="FT10192017">{{cite news|last1=Murphy|first1=Hannah|title=Police launch raids on 20 City of London businesses|url=https://www.ft.com/content/f5cf9ff2-b4d2-11e7-a398-73d59db9e399 |archive-url=https://ghostarchive.org/archive/20221210/https://www.ft.com/content/f5cf9ff2-b4d2-11e7-a398-73d59db9e399 |archive-date=2022-12-10 |url-access=subscription |url-status=live|access-date=October 21, 2017|newspaper =[[Financial Times]]|date=October 19, 2017}}{{subscription}}</ref> In March 2017, [[National Fraud Intelligence Bureau|Action Fraud]] issued a warning on binary options.<ref>{{cite web|url=https://www.actionfraud.police.uk/news/what-is-binary-options-fraud-and-what-are-the-law-enforcement-doing-about-it | title=What is Binary Options Fraud and what are the law enforcement doing about it? | date=March 31, 2017 | publisher=[[National Fraud Intelligence Bureau|Action Fraud]] | access-date=December 8, 2018}}</ref>
The [[Isle of Man]], a self-governing Crown dependency for which the UK is responsible, has issued licenses to companies offering binary options as "games of skill" licensed and regulated under fixed odds betting by the [[Isle of Man Gambling Supervision Commission]] (GSC).<ref>{{cite web | url =https://www.gov.im/categories/business-and-industries/gambling-and-e-gaming/licence-holders/ | title =Licence holders | website =gov.im | publisher =Isle of Man Government | access-date =2017-09-02}}</ref> This positions binary options as a form of gambling, and the administrator of the trading as something akin to a casino, as opposed to an [[Exchange (organized market)|exchange]] or [[brokerage house]].
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