Fighting A Flood
Canadian regulators have long fought a rising flood of binary options fraud. Warning after warning from once province after another, backed up by more warnings from national level regulators have failed to curb what some in high position regard as nothing more than a transaction whose sole purpose stealing money. The latest move is a push to completely ban binary options in Canada, an action seen as critical by the CSA in its fight against fraud.
The proposed legislation is called the “Prohibition of Binary Options” . It is being put forth by the Candadian Securities Administrators, the CSA, an umbrella organization of all 13 provincial and territorial regulators. While not a national level policy maker it does have quite a bit of power as it bears the power of the “people”. Even without a national change in policy this organization could lead individual provinces and territories to adopt a ban on a local level.
The question is, just how will a ban help them stop fraud? There are already no legal binary options brokers operating in Canada, they are all off-shore operating with impunity, so just how will a ban stop them? Canada has been friendly toward binary options in a general sort of way, allowing registered and compliant brokers to operate legally. The problem is that they have not allowed any brokers to register, preventing a legal and safe environment from forming and allowing an onslaught of off-shore brokers, signal services and marketers to take advantage of a largely untapped North American market.
Is There A Better Solution? Hell Yes!
When it comes to warning the public Canada has not been shy to include regulated (in other countries) and non-regulated brokers alike. NADEX at one time was operating in the country and was forced to quit rather than allowed to register with local authorities. Likewise, many CySEC regulated brokers have been named as actively marketing to Canadians which, while true, could help the CSA control fraud if only they would work alongside CySEC and the ever strengthening EU regulation.
The IIAC agrees with this. The IIAC is the Investment Industry Association of Canada, a lobby group for Canadian investment firms, advisers and industry professionals. In their view legally operated binary options would be win-win for Canada. It would help control binary options fraud, provide a legal and safe outlet for Canadians who want to trade and allow the Canadian financial industry to participate in its forming, operation and regulation. In the end it is not binary options that are bad, it is the shady black-hat marketer cyber criminals who are the problem.