Ronald H. Levy
Your phone and now, your computer can be a tool to losing your life’s savings. This is a fact that you need to understand in order to protect yourself from scams that are being perpetrated on Canadians daily.
The lure is a misleading “investment” vehicle called Binary Options. A Binary Option is an all or nothing wager or bet and should be understood as such. It is, simply put, gambling but with the additional risk element of placing this wager with an unregulated and unknown off-shore entity that may, but according to reports, rarely is, actually honoured.
Imagine deciding one day to place a bet with a bookie whom you do not know, who lives in a place that you cannot locate and who has misrepresented himself, the people who he is working for and his experience in order to get you to send him or her money.
Seems crazy- no? But thousands of Canadians are doing it every day in spite of warnings from the Autorité des marchés financiers (AMF), the Quebec financial markets watchdog, the Canadian Securities Administrators and the Ontario Securities Commission, amongst others.
The AMF has even gone so far as to list over 60 websites of unauthorized trading platforms set up to entice you to believe that you are actually involved in investing in the stock market and that you are acting responsibly with your investment funds.
To add to the exposure and risk, many companies operating at the fringe, misrepresent themselves as legitimate options traders and actually try and distinguish themselves from the “other” and disreputable operators. However, an investigation recently reported that with the help of search engine optimization (SEO) techniques, Google searches have prioritized these very companies as legal and ethical ones operating in an otherwise murky environment.
Adding injury to insult, even should the so-called investor (gambler) guess correctly, the real rub comes when you try and get your money out. It is reported by former insiders that various techniques are used to dissuade you from seeking your money and when push comes to shove, you are simply ignored, sometimes even threatened, and left with nowhere to turn or even address your complaint.
The best solution is to understand that the cards are dealt against you and that you are not even in a legitimate gambling environment.
If you feel compelled to try your luck with “Binary investments”, verify with your local securities watchdog to insure that you are dealing with a regulated entity which is actually located in Canada and that you are authorized by such regulator to provide such investment vehicles. Be also sure to verify that the funds of that entity are kept in Canada and audited as required by law.
There is some hope for those who have fallen for the hype and have invested large amounts with these companies. There have been some successes in recovering monies from these operators but diligence and timely interventions are key.
The best conclusion to draw: do not risk your money with dubious Binary Options companies. But if you are already stuck with them and can’t withdraw your money, get professional help that can offer you a combination of investigative skills, intelligence gathering capabilities and legal experience in multiple jurisdictions.
Ronald H. Levy, Litigation partner, De Grandpré Chait