US Binary Option SitesUK Binary Option Sites

Banc De Binary Shuts Down Operations Over Regulatory Pressures

Banc De Binary, a major online trading firm dealing with binary options recently announced that it is winding up operations. The Cyprus-registered but Israeli owned company has cited regulatory pressures for its closure. The company allows investors to bet on short-term price shifts in financial assets through binary options.

In a statement Banc De Binary, said

Banc De Binary will be gradually downsizing its operations due to regulatory constraints. For clients that have eligible funds in their account, we are encouraging them to withdraw the remaining balance

The company has had to pay $11 million as penalties in the United States with respect to charges filed against it for illegally enabling U.S. residents to invest on its site. Banc De Binary is not the only company to have been put under the scanner. Reportedly over 100 such firms are operating from Israel and the entire industry has come under scrutiny.

Shmuel Hauser, chairman of the country’s regulatory body, Israeli Securities Authority (ISA) recently stated that he was working with regulators from Britain, U.S., France and Belgium to examine charges that Israeli companies were illegally selling risky financial products to international customers.

A Reuters report released in September 2016 revealed the full extent of their operations and also highlighted allegations made by several investors through their lawyers of being duped by the firms. Among other things, the customers accuse the firms of transferring money between accounts without approval and preventing them from withdrawing funds from their accounts.

Last week the ISA took formal action for the first time against a binary options firm by sending a warning letter to Fairtrade, a binary options peer to peer (P2P) exchange for operating an unauthorized exchange. The binary options industry has been grown rapidly in the key markets of China, United States, Japan and Europe. According to two Israeli firms specializing in trading platforms, they work with online brokerage firms who handle combined trades worth $8 billion per year.

Operating through smartphone apps, the companies have been able to attract a wide swath of investors who are not professional traders which increases the risk attached to such transactions.

Regulatory body Hauser has banned firms from selling binary products within Israel and has requested the country’s attorney general to amend existing laws to ban companies from selling overseas as well. A draft legislation for the same is said to be in the works and is likely to be ready within a few weeks’ time.


Related Articles

Research Shows UK Businesses Not Taking Cyber Security Seriously

A recent research study has been complied based on a survey of UK businesses and their exposure to cyber attacks.

Buffett Advises Investors To Be Cautious With Wall Street Traders

Legendary investor Warren Buffett has said that investors lose by trusting their money to Wall Street investment managers in his

Harvard Economist Says China Is Biggest Threat To Global Economy

Harvard professor Kenneth Rogoff, one of the world’s most well-known economists has warned that the biggest threat facing the world’s