News & Events

CSA / ACVM
For Immediate Release
March 9, 2015

 

CSA Investor Alert: Unregistered binary option platforms target Canadians

 

Winnipeg – The Canadian Securities Administrators (CSA) are warning investors to exercise caution when considering an investment in binary options. The CSA has become aware of multiple websites promoting binary options trading platforms that are soliciting Canadians. Many of these websites are trying to lure investors by making untrue and/or misleading statements about Canadian securities regulators’ oversight of binary options.

Binary options are essentially “bets” on how a particular underlying asset will perform in a limited amount of time. Despite listing Canadian contact information, many binary options trading platforms are based overseas purportedly in countries like Cyprus, Belize and the Seychelles, and the companies managing these platforms are often not registered to conduct business in Canada.

Offering investment services or products, whether online or in person, is a regulated activity. Investing with offshore companies operating outside of Canada can be risky and is a common red flag of investment fraud. Once offshore, it can be nearly impossible for an investor to recover their money.

Unregistered trading platforms currently soliciting Canadians:


10trade.com fmtrader.com option.fm
24option.com goptions.com poweroption.com
247binary.com grandoption.com rboptions.com
24winner.com gtoptions.com redwoodoptions.com
amberoptions.com leaderoption.com stockpair.net
anyoption.com lionlive.com sycamoreoptions.com
bancdebinary.com no1options.com topoption.com
binareo.com onetwotrade.com traderush.com
binarytilt.com opteck.com tradersking.com
bosscapital.com optionfair.com triumphoption.com
cedarfinance.com optionrally.com ubinary.com
cherrytrade.com optiontime.com
dragonoptions.com optionweb.com

This is not an exhaustive list. The CSA encourages all investors to visit aretheyregistered.ca to check the registration of any person or company offering binary options to Canadians. Anyone who has invested with these or other offshore binary options trading platforms should contact their local securities regulator.

March is Fraud Prevention Month. Throughout the month, investors can follow tweets from @CSA_News for additional helpful tips and information on being a smart investor and fraud prevention.

The CSA, the council of the securities regulators of Canada’s provinces and territories, co-ordinates and harmonizes regulation for the Canadian capital markets.

 

 


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For more information:
Mark Dickey
Alberta Securities Commission
403-297-4481

Carolyn Shaw-Rimmington
Ontario Securities Commission
416-593-2361

Sylvain Théberge
Autorité des marchés financiers
514-940-2176

Richard Gilhooley
British Columbia Securities Commission
604-899-6713

Kevan Hannah
Manitoba Securities Commission
204-945-1513

Andrew Nicholson
Financial and Consumer Services
Commission, New Brunswick
506-658-3021

Tanya Wiltshire
Nova Scotia Securities Commission
902-424-8586

Janice Callbeck
PEI Securities Office
Office of the Attorney General
902-368-6288

Don Boyles
Office of the Superintendent of Securities
Newfoundland and Labrador
709-729-4501


Rhonda Horte
Office of the Yukon Superintendent
of Securities
867-667-5466

Louis Arki
Nunavut Securities Office
867-975-6587


Gary MacDougal
Northwest Territories
Securities Office
867-920-3318
Shannon McMillan
Financial and Consumer Affairs
Authority of Saskatchewan
306-798-4160s

 

Backgrounder: Binary Options

What are binary options?

Binary options are like an “all or nothing” wager on how an underlying asset will perform in a limited amount of time. Investors can have as little as 60 seconds to predict the market’s minute-by-minute fluctuations, which make investing in binary options extremely risky, even for seasoned investors.

Binary options are highly volatile and can produce wins or losses quickly, and because they are often traded in currency markets, they can present a high level of risk for many investors.

What are the risks?

There are several websites that allow users to trade binary options. Some may claim that these investments are risk-free or that the site will reimburse investors for lost wagers. However, these claims are inherently too good to be true; all investing involves some amount of risk, and most site disclaimers will clearly state that investors could stand to lose their entire investment.

Websites that facilitate binary options trades can sometimes expose investors to potential frauds, including manipulating the trading software to adjust a binary option’s price and payout. For example, if a trade is “winning” during its allotted period of time, the option’s timeframe may be arbitrarily extended until the trade becomes a loss.

Certain online binary options trading platforms have refused to credit customer accounts or reimburse funds after accepting users’ money. Would-be customers who have deposited money into a binary options trading account are later encouraged by the platform’s “brokers” to add additional funds. When these customers later attempt to withdraw their original deposit or the return that they have been promised, the “brokers” may cancel the withdrawal requests, refuse to credit the account, or ignore customers’ phone calls and emails.

Many binary trading platforms are based overseas, despite listing a Canadian phone number or address. This means that investing with these platforms will move an investor’s money out of Canada and make it nearly impossible to recover if something goes wrong. The companies operating these platforms may not be registered to conduct business in Canada, and all investors are encouraged to check the registration of a broker or firm before investing by visiting aretheyregistered.ca.