Scammers Beware, The FBI Is Out To Get You

The FBI Is On Full Alert

The FBI, in an alert to investors, says that binary options fraud is a growing problem. Well no #$%&. Binary options fraud has been the name of the game since the game was first introduced. I’m not saying that the entire industry is a fraud because its not. Trading binary options is perfectly fine, it’s a great way to speculate the market and easy way to have a little fun with the chance to make some money, if you find a good broker. That is the hard part and that is what, hopefully, the FBI and other international regulatory agencies are going to do. Help us all understand who is legal and where, who can trade there and what and keep all the money safe while we are doing it.

The CFTC laid a good foundation when they allowed binary to begin, the trouble is all the scam artists that hide behind their websites using VPN’s and other hi-tech computer wizardry to make people think they are a legit broker. The Internet makes it too easy, all you have to do is pay for hosting services, buy a URL, hook up with a white label platform provider, set up an offshore business, bank account and payment processor and you’re in business. The best brokers really are in the business of binary options, the worst are only in business to rip people off and in-between are the ones who could be legit, if they weren’t trying so hard to keep people trading and losing money.

This is where regulation comes into play and why the FBI’s new proclamation could turn out to be important. The basic message is nothing we haven’t heard before; most binary options brokers operating in the US/(insert your country here) are not legally operating or registered with appropriate authorities. The twist is that this time someone is using the words international and cooperation together with binary options regulation.

The FBI organized an international summit in January, located at the Hague, to discuss the growing problem. While there many European nations revealed that binary fraud accounted for as much as 25% of all complaints and the estimate may be low. The purpose of the summit was to establish what the risks were and where they were coming from and how to combat them going forward.

Special Agent Milan Kosanovich, which was one of the FBI’s representatives at this event, said: “The summit gave all of us the chance to sit down and talk about what we’ve discovered through our respective binary options fraud investigations, where the challenges are, and how we can all work together. . . So the key to addressing this type of fraud,” he went on, “is national and international coordination between regulatory agencies, law enforcement, and the financial industry.”

Based on actions being taken in Europe it looks like focus is splitting and intensifying on two fronts. On one side is tighter regulation, on the other is a crack-down on 3rd party services and marketing, where most of the scams come from anyway. For now, NADEX is the only US CFTC broker worth trading.