Regulators Crack Down So Unregulated Brokers Change Tactics

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Regulators Crack Down So Unregulated Brokers Change Tactics

Unregulated Brokers Slipping Through The Cracks

In a report first broken by FinanceMagnates in an exclusive story unregulated brokers are switching tactics. At least, they are moving to new locales and targeting new markets with the same old tricks. The problem they faced, a crack down on non-regulated brokerages and on their marketing tactics, forced many reputable brokers further into the light, and many unregulated brokers out of business. The ones that are holding on have simply taken steps to avoid regulator attention and slip through the cracks.

The first solution was simple, stop targeting people in countries with regulators, and especially those countries actively prosecuting binary options fraud. This mean attention is now focused on unregulated countries which today often means emerging markets and underdeveloped nations where hard working people are not as savvy to Internet based cyber crime as the rest of us. The second problem was less simple to affect if not so hard in theory. When regulators began cracking down on marketing tactics that meant call centers, the most fraudulent and aggressive of those centers located outside of regulated nations. CySEC’s solution was forcing call centers to be located within regulated jurisdictions and accept oversight, the unregulated brokers solution was to move their operations to countries they could operate in without fear.

Canada has been fighting binary options fraud for a long time. They’ve had so many problems the nations diverse group of provincial regulators have formed a special task-force to fight it and are even proposing a full ban. The only problem is that their efforts have proved futile up til now. CySEC regulated brokers are not allowed to market to citizens outside their jurisdiction which protects Canadians from legal binary options, the unregulated off-shore black-hat brokers are still up to the same old tricks, only they are getting better at it.

Two Canadian provinces issued new warnings against unregulated brokers. The first is from Manitoba’s MSC against TORoption. TOROption is operated by Smart Choice Zone LP from a virtual office in Glasgow, Scotland. It is not regulated by the FCA or CySEC and is another SpotOption white label. The broker is accused of accepting and marketing to Canadian clients without registration, regulation or licensing, the same old story. The second warning comes from British Columbia’s BCSC, one of the most vocal of all Canadian regulators. It is against HedgestoneGroup.com. Hedgestone is also accused of accepting Canadian clients even though it is not registered in Canada and the website says no Canadian allowed. Hedgestone is operated by Belize registered firm Smart Choice Zone LP but located in Bulgaria and not regulated in any way.

The REDList Gets Longer

The US CFTC and SEC created a registration deficient list, the REDList, as a means of warning investors of unregulated binary options and forex brokers operating in the US. The list got off to a slow start but has recently seen a number of new additions. The latest round includes 71 new names, both forex and binary, and also the names of individuals operating as “investment” advisers without authorization. As with all non-CySEC nations, this list includes a lot of names you will recognize as scams, and a few that are regulated to operate in Europe so be warned.

Regulators Crack Down So Unregulated Brokers Change Tactics

Unregulated Brokers Slipping Through The Cracks

In a report first broken by FinanceMagnates in an exclusive story unregulated brokers are switching tactics. At least, they are moving to new locales and targeting new markets with the same old tricks. The problem they faced, a crack down on non-regulated brokerages and on their marketing tactics, forced many reputable brokers further into the light, and many unregulated brokers out of business. The ones that are holding on have simply taken steps to avoid regulator attention and slip through the cracks.

The first solution was simple, stop targeting people in countries with regulators, and especially those countries actively prosecuting binary options fraud. This mean attention is now focused on unregulated countries which today often means emerging markets and underdeveloped nations where hard working people are not as savvy to Internet based cyber crime as the rest of us. The second problem was less simple to affect if not so hard in theory. When regulators began cracking down on marketing tactics that meant call centers, the most fraudulent and aggressive of those centers located outside of regulated nations. CySEC’s solution was forcing call centers to be located within regulated jurisdictions and accept oversight, the unregulated brokers solution was to move their operations to countries they could operate in without fear.

Canada has been fighting binary options fraud for a long time. They’ve had so many problems the nations diverse group of provincial regulators have formed a special task-force to fight it and are even proposing a full ban. The only problem is that their efforts have proved futile up til now. CySEC regulated brokers are not allowed to market to citizens outside their jurisdiction which protects Canadians from legal binary options, the unregulated off-shore black-hat brokers are still up to the same old tricks, only they are getting better at it.

Best Binary Options Brokers: 2020 Ranking
  • Binarium
    Binarium

    Best Choice! The leader in our ranking!
    Perfect for beginners!
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  • Binomo
    Binomo

    Good choice for experienced traders!

Two Canadian provinces issued new warnings against unregulated brokers. The first is from Manitoba’s MSC against TORoption. TOROption is operated by Smart Choice Zone LP from a virtual office in Glasgow, Scotland. It is not regulated by the FCA or CySEC and is another SpotOption white label. The broker is accused of accepting and marketing to Canadian clients without registration, regulation or licensing, the same old story. The second warning comes from British Columbia’s BCSC, one of the most vocal of all Canadian regulators. It is against HedgestoneGroup.com. Hedgestone is also accused of accepting Canadian clients even though it is not registered in Canada and the website says no Canadian allowed. Hedgestone is operated by Belize registered firm Smart Choice Zone LP but located in Bulgaria and not regulated in any way.

The REDList Gets Longer

The US CFTC and SEC created a registration deficient list, the REDList, as a means of warning investors of unregulated binary options and forex brokers operating in the US. The list got off to a slow start but has recently seen a number of new additions. The latest round includes 71 new names, both forex and binary, and also the names of individuals operating as “investment” advisers without authorization. As with all non-CySEC nations, this list includes a lot of names you will recognize as scams, and a few that are regulated to operate in Europe so be warned.

Non-Farm Friday – Fed Spins a Weak Economy

Surprise!

No, not the fact that the Republicans in Congress (not a single Democrat voted for this) yanked away your health care yesterday (while keeping Obamcare for themselves) and not the fact that your parents will soon be moving in for you as Republicans also rescinded small-business retirement plans so they could give their money to richer people too. No the surprise I’m talking about is the US Macro Surprise Index which hasn’t fallen this hard and fast since 2008 – another fun thing to ignore in market utopia.

The Citi U.S. Economic Surprise Index measures actual data readings are how they compare with expectations. A reading above zero means that the data on balance are coming in above expectations, while a negative reading indicates an economy that is underperforming and, suddenly, we’re at -20, down 80 points in a month! That decline began with last month’s horrific Non-Farm Payroll reading of just 98,000 but on Wednesday, the Fed indicated in their statement that they didn’t think it was a trend and the Atlanta Fed, in their GDP Now Forecast, are pegging Q2 growth (and we’re halfway through it) at 4%.

But the Citi index says they are idiots – or Economorons, as I like to call them. The indications we’ve been getting in April have, time after time after time, indicated growth is slowing (and last Q we only grew 0.8%), not speeding up and Corporate Profits, though strong, are being goosed by a weaker Dollar, weak comps and earnings that are simply divided by less shares due to buybacks.

There is A LOT of financial engineering in earnings reports these days. The gap between GAAP and Non-GAAP earnings has never been higher, with Q3 GAAP earnings coming in almost 25% lower than the Non-GAAP earnings they use to come up with the “official” S&P earnings. We’re not even in the ballpark of reality here – yet traders (I won’t call them investors for they know not what they are doing) keep BUYBUYBUYing – no matter how ridiculous the valuations get.

As we’ve discussed in the past, to some extent – money simply has nowhere else to go. You

Best Binary Options Brokers: 2020 Ranking
  • Binarium
    Binarium

    Best Choice! The leader in our ranking!
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  • Binomo
    Binomo

    Good choice for experienced traders!

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