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CSA alerts Canadians: Beware binary options platforms

2016/25
March 23, 2016

Calgary – The Canadian Securities Administrators (CSA) are increasingly concerned about the growth in the number of websites promoting offshore binary options trading platforms that are targeting Canadians. The CSA wants to make it clear: no business is currently registered or authorized to market or sell binary options in Canada.

Binary options are like “bets” on how an asset (currency, stock, etc.) will perform in a limited amount of time – they are “all or nothing” wagers, similar to gambling. However, even when investors see virtual gains, they often cannot access these profits as they don’t exist.

“Canadians are exposing themselves to the high risk of identity theft and fraud when signing up for these platforms that often request their credit card information,” said Louis Morisset, Chair of the CSA and President and CEO of the Autorité des marchés financiers. “The CSA warns investors that if they deal with these platforms, they risk the threat of thousands of dollars in unauthorized withdrawals on their credit cards and of being stuck with high-interest payments for a non-existent investment.”

Offering investment services or products, whether online or in-person, is a regulated activity. Investing with offshore companies operating outside of Canada can be risky and is a common red flag of investment fraud. Once offshore, it is often impossible for investors to recover their money.

Businesses illegally offering Canadians the chance to make quick and easy money from binary options are operating all over the world. CSA members are working together and with other regulators to share best practices in order to counter these widespread illegal activities.

The CSA encourages all investors to visit aretheyregistered.ca to check the registration of any person or company offering investments to Canadians. Anyone who has invested with, or has concerns about, an offshore binary options trading platform should contact their local securities regulator.

Best practices:

  1. Always check registration and enforcement history before investing.
  2. Be wary of giving out personal information (including credit card information) over the phone or internet.
  3. Don’t make a decision on the spot. Take some time to research the opportunity and review it with an independent third party.
  4. Ask to have written information about the investment sent to you.
  5. Make sure you fully understand an investment.


March is Fraud Prevention Month. Throughout the month, investors can follow tweets from @CSA_News for additional helpful tips and information on fraud prevention and being an informed investor. Investors can also visit the Investor Tools section of the CSA website to learn more about making informed investing decisions.
 
The CSA, the council of the securities regulators of Canada’s provinces and territories, co-ordinates and harmonizes regulation for the Canadian capital markets.

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For investor inquiries:

Quebec
877-525-0337

Alberta
403-355-4151
877-355-4488

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Nunavut
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Northwest Territories
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 For media inquiries:

Kristen Rose
Ontario Securities Commission
416-593-2336 

Mark Dickey
Alberta Securities Commission
403-297-4481 

Richard Gilhooley
British Columbia Securities Commission
604-899-6713

Sylvain Théberge
Autorité des marchés financiers
514-940-2176  

Ainsley Cunningham
Manitoba Securities Commission
204-945-4733

Andrew Nicholson
Financial and Consumer Services Commission,
New Brunswick
506-658-3021

Tanya Wiltshire
Nova Scotia Securities Commission
902-424-8586

Janice Callbeck
Office of the Superintendent of
Securities, P.E.I.
902-368-6288

Carl Allwood
Office of the Superintendent of Securities
Newfoundland and Labrador
709-729-2596


Rhonda Horte
Office of the Yukon Superintendent
of Securities
867-667-5466

Shamus Armstrong
Nunavut Securities Office
867-975-6587

Tom Hall
Northwest Territories
Securities Office
867-873-7490

 
  
  


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