Binary Options Scam - Broker’s Blacklist
Binary options are a fairly new phenomenon in the foreign exchange market. They evoke both distrust and genuine interest among the general public like any new trading option. Both the first and the second result from too much curiosity. However, you should be aware of the risks and thoroughly study the market before running full steam ahead to satisfy your curiosity. “Binary options scam” is a popular search phrase in search engines and a sensitive issue in real-life trading.
What are binary options?
Working with binary options is similar to trading on the Forex market, but the whole process is much easier here. In the classic binary options trading scheme, a trader places a bet on an increase or decrease in the price. If the rate is triggered, he accrues his income. Simultaneously, this is not just a roulette-type game. There are many tools for predicting the most probable trend for trading binary options. Indeed, most of the factors affecting a trader's work regarding binary options are already known beforehand.
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Below you will find all the information.
The perceived simplicity of binary options trading has triggered a vast array of scammers who would do anything to cash in on naive and nescient traders and deceive them to become filthy rich. Although binary options, as well as scams based on them, are gaining momentum, there’s still a huge number of deceived people. The number of unscrupulous binary options brokers who arrange soi-disant binary options on their platforms aimed at the uninitiated trader is not decreasing either.
As a result, those who conduct scam schemes involving binary options often become very rich. Credulous clients lose their hard-earned money, the reputation of the binary options market is smeared, and users’ faith in binary options is exhausted. Therefore, you need to thoroughly study the market features and be able to recognize scams and schemes based on binary options before you start working with these new options. Reviews of the newest binary options scams are often published on the internet.
Binary options scams are aimed at the uncautious and too-eager trader
The classic scam on binary options is the constant delivery of "super-profitable" and "win-win" signals for trading. Binary options scams create a large number of different sites on which they invite users to get acquainted with their offer in an inappropriate manner. It’s intended to spark the attention of credulous or novice traders. Binary site scams often give a 100% guarantee that the future client will earn a pretty penny on their (the broker’s) approach to binary options. They even try to prove this by posting screenshots of the page with the income received from transactions carried out with the aid of these schemes. As a rule, most of these self-styled evidential schemes turn out to be a fluke upon close examination.
They promise naive clients the moon and the stars and favorable conditions for trading, but their real goal was to deceive the trader, steal his money, and quickly move on to the next naïve target. As a result, a person can call support and complain and demand a return of his account deposit, but all these hands-on attempts will not be successful because no one forced the client to make the deal.
As a rule, fraudulent sites hide behind the name of some character, often fictitious. For example, a so-called John Johnson offers you a win-win strategy or super signals. He offers them completely free of charge because he has already earned a fortune beforehand, and his natural kindness simply does not allow him to keep this knowledge a secret. He wants everyone else to get rich too, but he does not ask for anything in return due to his philanthropic nature.
When a trader becomes extremely interested in binary options, all of a sudden it turns out that the author does not need to pay anything specifically for them to get signals. However, you are obliged to pay the broker by making an “initial deposit to open your account”. This is just another well-worn “pay to play” scheme. If the trader doesn't pay upfront, he cannot open an account which is needed to test the effectiveness of the awesome win-win strategies on offer. Wink-wink.
Some say that these strategies can be tested anywhere; and that tests can be done on any account already opened by a trader on a trustworthy broker’s platform; or on a demo account, where the trader will not go into the red if the strategy or the signals don’t work. Besides, there are cases when traders already have an account with a broker, and the author of the binary options scam nevertheless convinces them to join the ploy. It would be smooth sailing since you do not need to create a new account and spend money on a deposit, but unfortunately, such users won’t get these miraculous win-win methods.
So why is it extremely profitable for binary options scammers to get a new client for a particular binary broker? The fact is that this is exactly how these fraudulent schemes work: the con artist receives money from the broker for each client brought in based on the customary referral program. The client replenishes his deposit (as a rule, the amount can vary from $250 up to $500) and tries to trade on the signals supplied by the binary options con artist. But it is not profitable for the broker if the client wins trades. Instead, the scammer generates revenue only from the lost trades. Therefore, the signals are likely to be inoperative, and the trader loses his deposit account. The result: everyone makes money in this scheme except the trader.
There are cases when the unscrupulous broker himself creates the image of a professional trader (you do not have to pay fees to someone else, but keep this money for yourself) to attract new clients with the help of a third party. Such a scheme of binary options looks like a dishonest marketing ploy, where the middle-of-the-road people suffer.
What fraudulent schemes are most used by binary options scammers?
This table summarizes the most popular ways in which binary scammers attract investors and lure money out of them.
| Method | Description |
|---|---|
Cold calls |
The broker's managers call and offer to register the trader on the company's website, and if you are already registered, you need to top up your account and start trading. |
Emails |
They conduct massive and aggressive newsletter campaigns regarding bonus offers by the company with overly attractive conditions, as well as the results of pseudo-contests that were allegedly held by the company, complete with the name of the “winner” and a demonstration of the “prize”. |
Social media advertising |
Company representatives use diverse techniques to spark the interest of potential investors with the help of popular bloggers and targeted advertising. Many manage their own blogs where they demonstrate fancy and lavish lifestyles |
YouTube advertising |
The company has an official channel for trading on the binary options market, where the videos demonstrate fake screenshots with super-profits of successful traders who make money in the binary options market through his company. |
|
Publishing false success stories on traders' forums |
The scammer creates a fictional character who plays the role of a successful trader and an official representative of a binary broker, publishes profitable reports on his trading with fake screenshots, and offers trust management services. |
This table summarizes the most popular ways in which binary scammers attract investors and lure money out of them.
Bear this in mind!
You need to have experience in trading, as well as a knack for analyzing and predicting the market on your own to become a successful trader in the binary options market.
How to cognize a scam based on binary options
They not only promise a guaranteed income, but also indicate the exact amount of money, and the time frame during which you can earn the money. Do not blindly trust the representatives of binary options that offer miraculous strategies that use super-profit trading robots or even trust management services that will magically earn pots of gold. If a company asks you to deposit more than $200 from the get-go, most likely this is a scam to steal your money.
You should not trust companies that offer a vast number of various bonuses and promotions. This is the distinctive feature of a fraudulent binary broker. Do not believe blindly that you can make money in the binary options market without any expertise and experience. Binary options require certain know-how, practice, and experience to be successful — just like any other business.
The key features of binary options fraudsters
If you don’t want to be a victim of these scams and schemes, you need to avoid fraudulent brokers who:
Offer their services aggressively and insist on you making a deposit to a trading account while promising risk-free super-profits even if you are as green as a gooseberry.
Offer win-win trading strategies and signals, which are primarily focused only on draining the deposit. At the same time, the broker does not provide a trial period for testing these signals and strategies.
Do not obey any of the well-known financial regulators, have licenses from organizations with a dubious reputation, and are also registered in an offshore zone.
Do not openly publish information about their legal entity on the website, such as the official name of the company, legal address, data on its jurisdiction, or official contact information.
Have tons of negative reviews on the internet, where traders describe their experience of working with a fraudulent broker, and also talk about the deceptive schemes used by these soulless scammers.
It’s a matter of utmost importance!
The Traders Union publishes on its website a list of unscrupulous binary options brokers, most of which are scammers or fraudsters that prey on credulous traders or traders with a get-rich-quick mindset. Some simply have not been verified by the Union and therefore are not recommended for cooperation. The reason for each binary company being included in this anti-rating is indicated in the broker's profile. For the safety of your funds and real earnings on trading options, we recommend cooperating only with companies from the rating of binary brokers that have shown themselves to be reliable partners of the Traders Union, fulfilling all their obligations under partnership agreements. Protect yourself and do not blindly trust unverified brokers or you might be in the red down the road.
| Company | SCAM date |
|---|---|
2014 |
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2014 |
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2022 |
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2018 |
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2015 |
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2013 |
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2016 |
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2015 |
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2015 |
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2013 |
What to do if you are scammed by binary options charlatans
It’s a matter of utmost importance!
Before starting cooperation with a binary options broker, check thoroughly his client agreement, the rules for making trading operations and filing claims, as well as its complete legal documentation. Ask questions to the broker's representatives on questionable points of the agreement, wait for an answer to them and assess the level of competence and professionalism of the company's employees. In the process of cooperation, record your every action. Take screenshots of trades, save electronic receipts for replenishing your trading account, and save the history of correspondence with company managers, etc.
If you have already suffered from the actions of binary scammers, you should:
Submit an official claim to the broker in the format and within the timeframe established by the regulations for filing claims.
Provide the broker with evidence of his illegal actions: all materials that can confirm the violation of the client agreement by the broker and prove his guilt.
Wait for an official response from the broker to your claim within the time frame established by the regulations.
If there is no answer or it does not satisfy your claim, contact the financial regulator that controls the activities of your chosen broker.
Before receiving a response from the regulator or broker, withdraw all funds from your trading account and constantly remind yourself of your pending claim because the entire process may take weeks or months to complete.
To be entitled to free legal support of qualified specialists and not to waste your own time on resolving a possible dispute with a broker, register on the Traders Union website, and cooperate only with trusted and reliable companies. Even in the event of a conflict of interest, your rights will be protected and you will not have to resolve the disputed situation on your own. The Traders Union’s seasoned legal professionals will do it for you!
5 Common Binary Options Scams
Binary options trading can be a lucrative investment opportunity, but it's essential to be aware of the potential scams that can undermine your financial goals.
The "Free Training" Scam
Fraudulent individuals or companies may offer you free training materials or courses, promising to turn you into a trading expert in no time. However, the underlying motive is often to lure you into their scheme, where they'll profit from your deposits or commissions without delivering any valuable training.
The "Signal Provider" Scam
Signal providers claim to have expert knowledge and accurate predictions about market movements. Unfortunately, many of them provide inaccurate or deliberately misleading signals leading to significant financial losses.
The "Broker" Scam
The "Broker" scam involves dishonest brokers who manipulate the trading platform to their advantage. They may manipulate prices, delay or refuse withdrawals, or engage in unauthorized trades on your behalf to maximize their profits at your expense. Always work with reputable and regulated brokers.
The "Get Rich Quick" Scam
Binary options trading attracts many individuals seeking quick wealth and financial freedom. Scammers take advantage of this desire by promoting unrealistic promises of overnight riches. In reality, binary options trading involves risks, and genuine success requires knowledge, experience, and careful decision-making.
The "Managed Account" Scam
Scammers posing as experienced traders or investment managers offer to manage your trading account on your behalf. However, instead of working in your best interest, they manipulate trades or misappropriate your funds. It's crucial to verify the credentials of anyone offering managed account services.
Key Tips for Protecting Yourself Against Binary Options Scams
Here are some key tips to help safeguard your investments and minimize the risk of being scammed.
Invest With Regulated Brokers
Regulated brokers operate under the supervision of financial authorities and must adhere to strict guidelines and regulations designed to protect investors. Investing with them ensures the safety of your funds and provides recourse in case of any issues or disputes.
Be Wary of Unrealistic Promises
Be cautious of brokers or individuals who make unrealistic promises or guarantee sky-high returns. Remember that no investment comes without risks, and binary options trading is no exception.
Conduct Thorough Due Diligence
Before engaging with any broker or investment service, conduct thorough due diligence. Research the broker's reputation, read reviews, and look for any red flags or complaints from other traders.
Educate Yourself
Learn the fundamentals of binary options trading, including risk management strategies and common trading techniques. Building your knowledge base equips you to make informed decisions and spot potential scams or misleading information.
Verify Withdrawal Procedures
Before investing with a broker, ensure that you understand their withdrawal procedures and policies. Scammers may impose unreasonable restrictions or delay the withdrawal of funds. Look for brokers with transparent and straightforward withdrawal processes.
Unsolicited Offers
Scammers often reach out through unsolicited emails offering lucrative investment opportunities. Exercise caution when dealing with such communications, as legitimate brokers typically do not approach traders in this manner.
Where Can I Report Binary Options Scams?
If you have fallen victim to a binary options scam here is a list of regulators in different countries to whom you can report the incident.
United Kingdom - Financial Conduct Authority (FCA)
The FCA serves as the regulatory body responsible for overseeing and regulating financial markets, including binary options trading. Report any binary options scams to the FCA for investigation.
United States - Commodity Futures Trading Commission (CFTC)
In the United States, the CFTC regulates derivatives markets, including binary options. If you encounter a binary options scam in the US, you can report it to either the CFTC.
Australia - Australian Securities and Investments Commission (ASIC)
ASIC is the regulatory entity in charge of monitoring financial markets, including binary options, in Australia. Any fraudulent practices should be reported to ASIC.
Canada - Canadian Securities Administrators (CSA) and British Columbia Securities Commission (BCSC)
If you encounter binary scamming in Canada, you can report it to the CSA or BCSC for investigation and they will take necessary action to protect you.
Singapore - Monetary Authority of Singapore (MAS)
If you are a victim of a binary options scam in Singapore, you should report it to MAS, which will take action against unscrupulous brokers.
Binary options scam or great opportunity | Expert’s opinion
The binary options market is quite profitable for traders who prefer to trade these financial instruments and know what they are doing. A professional approach to work is crucial here: market analysis and the formation of your trading strategy are required. Often a misconception about getting instantaneous super-profits in the binary market prevents beginners from taking binary options trading seriously, which entails failures and a loss of investments.
Besides, most often a binary broker is a dealing center with a built-in trading process that does not have access to the interbank market. This is important, but not the most critical drawback when comparing the massive lack of regulation among binary options brokers. A license from a serious financial regulator like CySEC or FinaCom level in this segment is very rare, unfortunately.
If you want to become a successful binary options trader, you need to remember that working with these instruments requires a certain amount of experience and know-how. You shouldn't take risks and hope for excess profits or use all your funds to complete a single transaction. Even if they promise you gigantic profits, remember that the risk of losing all investments is as great as the chance to get the maximum profit.
But most importantly, you should choose only a reliable and proven binary options broker for cooperation who has been working in the binary market for many years and has an impeccable reputation. In order to have additional support from professional lawyers, choose a broker from the Traders Union rating.
Traders Union Analyst
FAQ
What are Binary Options?
Binary options are financial trading instruments that can easily make large profits. You just need to correctly predict the change in the price of the selected asset.
What are the risks when working with binary options?
As fast as making a profit when trading binary options, you can incur losses. If you want to avoid this, carefully analyze the market and follow the rules of money management.
How not to become a victim of a binary options scam, fraudsters, and con artists?
To avoid fraudulent schemes in the binary market, compare the practices of scammers and the blacklist of binary options brokers on the Traders Union website.
What to do if you are scammed by binary options scammers?
Study in detail the broker's regulations and all its legal documentation and file a claim with the broker or regulator. To get free legal assistance, register on the Traders Union website and work in the financial markets under the protection of the largest community for traders worldwide.
