SEC: Binary Options Case Triggers Investor Alert

Is there a double whammy in your MLM future — first being ripped off in a binary-options “program,” only to be ripped off a second time by scammers posing as government agencies and offering purported refunds for a fee?

Naturally some MLMers have added binary options to their offerings, with some incredible solicitations and tales being told online. BehindMLM.com, for example, recently reported on the purported death of “Bob Roberts,” an asserted figure from a “program” known as Options Rider.

In 2015, the PP Blog reported that Quebec’s securities regulator was concerned that binary-options scammers were steering people into reload schemes and posing as government entities. Meanwhile, there was the tale of SpotFN, a purported binary-options platform that reached across the oceans and plains to pluck investors in Missouri.

At least one Missouri investor was told his money could be retrieved by paying a fee to a purported insurance company, authorities said.

Binary-options “programs” also are appearing on the Ponzi boards, alongside HYIP, cycler and “advertising” scams.

In 2013, the SEC brought an action against Cyprus-based Banc de Binary Ltd., its founder Oren Shabat Laurent and three affiliates alleging “that they failed to register the offering before soliciting U.S. customers through YouTube videos, spam e-mails, and other Internet advertising.”

Banc de Binary has agreed to pay $11 million in a settlement, the SEC said today.

This includes “$7.1 million in disgorgement and $1.95 million in penalties to the SEC as well as $2 million in penalties to the Commodity Futures Trading Commission (CFTC), which filed a parallel action,” the SEC said.

“Banc de Binary and its affiliates completely disregarded U.S. laws and registration requirements, and as a result they must surrender millions of dollars and be suspended from the industry,” said Michele Layne, director of the SEC’s Los Angeles Regional Office.

Harmed investors will receive a distribution from a Fair Fund administered by the National Futures Association, the SEC said.

Although it is nice that money apparently is available to compensate Banc de Binary customers, that’s not always the case, perhaps particularly with cross-border schemes.

The settlement wasn’t the only news the SEC announced today. Indeed, the agency announced an Investor Alert that warns of “impersonators” tag-teaming the Banc de Binary case.

“The SEC has become aware of some impersonators claiming to be affiliated with the SEC or other government agencies who have contacted harmed investors in this Banc de Binary case and asked them to pay a fee to facilitate their settlement payout,” the SEC said.  “It’s important for all investors to know that the SEC never makes people pay to get their money back.”

Read the Investor Alert. “Avoid becoming a victim twice,” the SEC urged.

Read the CFTC’s statement, which says a U.S. federal court has imposed “a permanent ban on offering or trading any further off-exchange binary options to U.S. customers.”

Read Banc de Binary restitution information from the National Futures Association.