Binary Options Regulation Scam


Are you worried about the safety of binary trading?

Wish to verify whether binary options have proper regulation?

Read this article to find out the truth about the regulatory documents and promises presented by various brokers, and learn to differentiate between a regulation scam and real consumer protection.


What is Financial Regulation?

Any financial institute that receives investment monies from clients needs to inform customers about the safety with which said funds are treated. You, as a trader, should understand where your money is physically kept, and have a reasonable level of assurance that the company you choose has the ability to retrieve the amount it is retaining for you.

To ensure companies will always have the clients’ investment available at all times, governments create supervising authorities that monitor each firm, and create clear guidelines to be followed by the regulated companies. Although there are several aims to financial regulation, that is the one that should concern you.

Binary options regulation has been under constant scam accusations by both unsatisfied customers and mistrustful governments. Is this suspicion justified, or are the fraud rumors true?

Trustworthy regulation vs. forged regulation

Not all binary options brokers declare themselves to be regulated. Those who do, generally present one of the following four types of regulatory stamps:

  1. Cyprus Affiliate Exchange Commission
  2. Affiliation to an European Financial Register
  3. Commodity Futures Trading Commission (or similar entity)
  4. Isle of Man Gambling Supervision Commission (or similar entity)

Although all these names seem important and reliable, the question is: are the binary brokers truly regulated by them, and if so, does that make a difference to customers?

The Cypriot Binary Regulation Scam

Most binary brokers migrated to Cyprus in recent years, after the government of that small European country offered a regulatory process created specifically for this field. To begin with, this was a questionable idea, since the island was already facing a serious financial crisis when the idea of luring the binary options field to the country through regulation laws was established.

Those brokers who obtained regulation through CySEC can be considered fully regulated, provided they are not a white-label brand, but rather own their trading platform. Though this regulatory process is the only one currently within the binary options field that provides some security to traders, some companies that have received the license only guarantee the investments of their European customers.

Financial Registers Scam

Some binary brokers, in an attempt to provide some sort of proof about the reliability of their business, commit the serious mistake of exhibiting affiliation stamps as evidence of proper regulation.

What does this mean? Quite simply: any firm registered in any country will be listed in some sort of formal governmental association of companies. In the USA, for example, every single company is listed in the local state registry, normally under the name of Corporations Division.

How is this related to regulation? The truth, it is not. This governmental registers are simply an inventory of the firms which are legally established in that country, without any reference as to their ability to ensure your money.

Sadly, forging regulation using the fancy authoritative logos and names of governmental listings is common among certain binary options companies.

The Futures regulation scam

Another method used by some companies in the binary options market is to display proper regulatory documents that are associated to a part of the corporation. By doing so, the traders are lead to believe their funds are supervised, when in reality they are not. An example of this conduct is companies trading future contracts in the USA, under the Commodity Futures Trading Commission.

In other words, some binary brokers are active in other financial markets, and offer additional investment services. These businesses are indeed properly regulated within the activity where regulation is possible. Technically, the client opening an account and placing a deposit does have some level of reassurance, since the corporation as a whole underwent a regulatory process.

Nonetheless, since binary options trading is yet to be defined under regulation laws, if customers are operating with binary trading through those firms, their investment is not secure by the regulatory body.

Binary Options and Gaming Supervision

Recently, binary options brokers have invented a new way to become regulated. For this purpose they have sought supervision from governments that offer regulation for gambling sites.

One such example is brokers registered by the Isle of Man Gambling Supervision Commission. Although this very tiny British dependency hardly inspires confidence, their regulatory guidelines are firm and do provide consumer protection. Nonetheless, in such instance, you will not be formally classified as a financial trade, but rather as a gambler. This has both legal tax-related implications that may influence your gains significantly.

Binary trading regulation restrictions

The real situation concerning binary options brokers is that regulation currently simply does not exist. This is not as absurd as it seems. This type of online financial derivative is very recent, having been launched in late 2009. Different countries have individual legalization processes for new investment instruments, and these may take years before they are fully established as a law.

While some governments will try to limit the offering of such services which are yet to be judicially bound, others, on the contrary, will allow these investments to happen so as to study their development and implement laws that properly oversee these activities.

Since regulation is not possible, binary options brokers have tried to offer all these alternatives in order to give clients a sense of security. In reality, it would be best if all companies would simply have the transparency of informing clients of the situation.

The result is that only a handful of binary firms are reliable. These brokers are no different than the rest of the options’ field, in that they too cannot be regulated. Nonetheless, their size, professionalism and most importantly, an excellent reputation, are what turn them into the best choices for your binary investment.

Trustworthy Brokers

Here is a list of binary firm that are fully regulated. Additionally, they focus on giving their customers the best trading experience day after day, and the ability to create profits by helping them acquire trading strategies and know-how.

Banc de Binary is probably the most respected binary options broker worldwide. This company offers excellent customer service, the best free online tutorials, the highest payouts (at 91% per trade) and a generous real-cash bonus for your deposit. With the best financial advisers at your disposal, Banc de Binary is a solid destination for your investment:

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OptionBit is the largest binary options corporation, and has a very special advantage: the most innovative free trading signals tool – Algobit. Algobit scans markets and finds the best trades for your investment portfolio. Furthermore, OptionBit’s huge asset list, exceptional free investment guidance and educational tools will allow you to feel like a pro-trader in a very short time:

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Another licensed broker, UBinary offer one-on-one training, the highest payouts, an awesome mobile trading site and a very personal approach to each client. This broker is perfect for new traders eager to get some help as they start creating profits online. It is considered one of the most reliable and effective binary options firms and as soon as you open your account, professional advice will help you profit faster:

Binary Options Regulation Scam – Summary:

In spite of promises and declarations, as a matter of fact no binary options company can attain proper regulation at this time.

Although other alternatives exist, their purpose is mainly to disguise the fact that this market is yet to be regulated.

The tendency by certain binary options brokers to present themselves as having governmental supervision is detrimental to clients, giving the false impression that such legal invigilation exists.

Except for the CySEC regulation process, the regulation options in existence today are either limited in the restrictions that can be imposed, lacking the economical backbone to provide assurances, or related directly to online gambling.

Therefore, you should choose from among the regulated companies those which  act with transparency, do not present false regulatory stamps, and have a pristine reputation