Financial regulators are increasing their actions against binary options and CFDs. According to the authorities, binary options has caused one of the highest losses for consumers. Today, the CFTC fined Binary International for violating the national trading regulations.
July 30, 2019 | AtoZ Markets – The US Commodity Futures Trading Commission has issued another fine, this time against binary trading company Binary International which had been violating the national trading regulations.
CFTC fines Binary International for regulations violation
As per media reports, the US financial authority has issued a $200,000 fine, not only against Binary International but also against its principal Curtis Dalton of Middleton, Massachusetts.
According to the final CFTC statement, which supplements the fiscal penalty, Dalton is prohibited from ever trading, soliciting or accepting funds from others for the purpose of trading commodities. As for the company, it is no longer doing business via the internet.
As per the company’s reviews, on its official website, Binary International claims being somehow associated or partnering with well-known businesses like MasterCard, the London Stock Exchange, Maestro, Nasdaq, and others.
The detailed CFTC complaint states, that the company had been operating since 2016. It was offering different trading tools, including binary options on FX pairs on a platform operated by an unregistered British Virgin Islands company located in Cyprus.
According to the court’s order, Binary International was not registered in the United States as a designated contract market, an exempt board of trade or bona fide foreign board of trade. Thus, the binary-options deals the company had been proposing “constituted unlawful off-exchange options.”
The US binary options companies are on the CFTC radar
Last week, the Texas Federal Court fined Morgan Hunt and Kim Hecroft in connection with a lawsuit on binary options scam charges, which were filed by the Commodity Futures Trading Commission (CFTC). Back then the total fine reached $400,000.
However, the consumers’ losses could hardly compete with this number. According to one of the Australian research agencies, investment scams have caused $18m losses in the first five months of 2019, which included binary options schemes. In Europe, the risky nature of binary options are already known for a long time, that’s the reason why the European authorities issued a permanent ban on binary options.
As per US national authority, many foreign entities, like Binary International, are required to be registered with the CFTC. It enables the regulator to provide greater security for the consumers and keep the track of the firms which do not meet minimum financial standards.
However, the CFTC press release outlined that registration is no guarantee against fraud or mismanagement by an unethical firm. Although, the CFTC does help bring a higher level of security and accountability to the industry. Therefore, the Director of Enforcement James McDonald reminds customers that they should do their homework on any firm they intend to use to trade on the markets.
Please share your thoughts in the comment box below.