Binary options have been receiving nothing but hate in the past few years. They used to be very popular before everything came apart and all of the industry started crumbling in front of the eyes of the investors. Most of the brokers that used to work on Binary Options were legit good brokers, who promised their customers realistic returns and in all honesty, gave them those realistic returns.
What Happened with Binary Options?
Unfortunately, however, the gambling nature of Binary Options attracted a lot of scammers, who used to make this elaborate marketing campaigns, promoting their “successful” customers who made millions and are now retired living in the alps. Many people actually fell for these tricks, because they were quite new and nobody had experience in them. Soon enough everything came apart and the true face of Binary Options brokers was seen. Most of the scammers quickly scattered, leaving the reliable brokers to clean up the mess.
All the scamming and stealing forced the EU to ban the product completely. It decided that regulating them would be much more big of a hassle than just outright banning them. Plus the regulations would have been so harsh that most of the brokers wouldn’t even want to feature Binary Options because of the small profits. Unfortunately, however, the ban seems to have not worked.
It is so easy to mislead customers into believing that a certain broker is regulated by a well know regulatory body. Before everybody starts figuring out the scam and the official regulator issues a statement about them, they would have already made enough many to pack up, leave and then rebrand. This was the case when on October 4th, it was announced by the Cyprus Securities and Exchange Commision (CySEC) that two websites, Binatex and 24Traderush were misleading their customers by claiming to be regulated by the CySEC.
How these websites were scamming their customers
Even though the Binary Options industry has been pummeled into submission by the EU, some gullible citizens are still susceptible to promises of quick profits, promises of becoming millionaires an so on. All of the Binary Options that are a complete scam, are currently being advertised as life-changing investments that made people transfer from a 9 to 5 job to a financially independent life, with which they always travel and have lots of fun. They buy luxury cars homes and so on. Naturally, this was going to attract attention.
The next step was the call centers that would call you uncontrollably, trying to make you deposit some kind of fund in your account. What’s worse is that the calls look like they are coming from the UK, but it is obvious by the accents of the call center sales people that they are being outsourced somewhere outside the EU.
The only thing the regulators can do is to find, identify and ban these kinds of advertisements. However, before that can be achieved advise needs to go out to all the “get rich quick” enthusiasts to not get into trouble and stay away from those promises of quick money.