SEC sanctions offshore binary options trading firm

first_img Australian court finds against binary options firm Facebook LinkedIn Twitter Related news The U.S. Securities and Exchange Commission (SEC) has sanctioned Israel-based EZTD Inc., an offshore binary options trading firm, and ordered it to pay more than US$1.7 million for “misleading investors into trading binary options over the internet.” ETZD has agreed to forfeit approximately US$1.5 million in revenue obtained from U.S. customers and pay a US$200,000 penalty. It also no longer sells binary options in the U.S. market. The firm, which was not registered, failed to disclose that investors are much more likely to lose money, rather than to earn money, trading on its platforms, according to the SEC’s order. In addition, the SEC notes that less than 3% of the approximately 4,000 U.S. investors that opened accounts with the firm generated any profits. “EZTD’s revenue was largely derived from customer trading losses, yet EZTD emphasized the profitability of trading in binary options,” says Stephanie Avakian, deputy director of the SEC’s division of enforcement, in a statement. “Companies dealing in binary options must disclose more than general statements about investment risk so investors in these instruments understand that the odds are stacked against them.” The SEC also warned that there may be other firms out there committing similar violations and issued an investor alert warning about the risk of dealing with unregistered, offshore firms, and detailing red flags that may signal binary options fraud. “We continue to receive numerous investor complaints involving binary options websites,” says Lori Schock, director of the SEC’s Office of Investor Education and Advocacy, in a statement. “If you have trouble withdrawing your money from an online binary options trading platform, be aware that you may be the victim of a scam and should not give the platform any more money.” Canadian regulators also have repeatedly issued their own warnings about unregistered binary options trading firms soliciting investors here. Aussies join binary options bancenter_img OSC sanctions binary options enabler Keywords Binary optionsCompanies Securities and Exchange Commission Share this article and your comments with peers on social media James Langton last_img

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