Binary options trading is a scam! It’s sad but true.
Now, there is a difference between “Options Trading” and “Binary Options”. Options Trading is long established and a legitimate, albeit risky if you don’t know what you are doing, form of trading. Most reputable brokers offer options trading to their clients and they are happy to offer assistance in educating their clients. I have an online brokerage account with Questrade where I can dabble in stocks and they offer options trading also; in fact I have used it, even made money on options.
But, that’s not what we’re here to talk about. This is about the murky world of Binary Options.
Later in this article, I will tell you a little about my personal experience from a few years ago. I’m not embarrassed to tell you, partly because I knew going in that I would possibly never see my money again and partly because I wanted to check out one of these get-rich-quick schemes that wasn’t going to cost me a whole lot of money. Who knew, maybe I could get rich!
Some might say that all you need to do not to get scammed is stay away from bad brokers or robot services, but they don’t realize that just about the entire industry is a scam.
It is estimated that the amount that gets stolen from people every year is close to $ 10 billion. These “online investment brokers” prey on the greedy and gullible by promising them massive ROI (Return On Investment). But alas, the clients end up losing their hard earned money.
Most binary options trading sites appeal to not only the same kind of people who want to get rich by playing poker online, but folks who are maybe desperate to grow their money so they can one day dream of retiring as they know that they will likely never have enough money saved. This means they think they have to take a chance and these sites give a “feel” of authority and appear respectable as they seem to offer investment opportunities.
Don’t fall into the trap!
How do binary options trading scams work?
Binary options are nothing but a bet that the price of a specific asset will rise or fall within a set time frame. If you win, the broker is supposed to pay you back your share multiplied by a win payout factor that typically ranges between 75% and 95%. If you lose, you pay your share minus a loss payout.
Here, it’s not the market that you’re trading against, but the broker. You must lose for the broker to make any money. And as one would expect, the whole system is rigged to favor the broker. The charts you see on the websites are nothing but hogwash of different colors and flashy numbers.
It’s all a facade to convince you that real work goes on behind the scenes. Hey, the broker might even make you win initially to garner more confidence, but as soon as the account managers fail to convince you to invest more, they’ll turn the tides.
All of a sudden, the trades you were winning will inevitably start going south. You would think that you can at least withdraw the remaining funds, but what you get is all kinds of hidden conditions and delays. At this point, there is nothing you can do to get your money back.
To simplify, the average binary trading scam works like this:
1. A fictitious company starts a website that looks legitimate and poses to be a binary options broker.
2. They claim to have a trading signal software that promises to be 100% accurate.
3. You make a small initial deposit of let’s say $ 200 for unknowingly joining the scam.
4. You then receive a call from a person pretending to be a senior broker asking you to invest $ 5000 or $ 10,000.
5. Unwilling to invest such a large sum, you ask them to refund the deposit, but they don’t do it. The scammers are richer by $ 200.
What goes on behind the scenes?
Most of these binary holding companies are based in countries such as Israel, and close to 95% of the brokers are scammers. These “brokers” are usually young and impressionable salespeople who want to make big bucks and sustain a lifestyle in Tel Aviv. The salespeople work in a morally deprived environment and are taught aggressive sales tactics.
As mentioned above, most of these companies have been located in Israel but the government there has finally stepped in and has started shutting them down. The Israeli crackdown was largely motivated by an investigative article posted by the Times of Israel newspaper.
They are trained to lie and prey on a potential client’s emotions to get them to invest money. The names these salespeople use are fake; neither do they have any experience in finance that makes them eligible to manage money. What they are good at is telling you the words you want to hear.
But how can they evade the law? Believe it or not, this scam of massive scale has been around for years. The authorities cannot crack down on the scammers because they operate under elaborate contingency plans that ensure they get to keep the stolen money.
The holding companies set up in Israel have ties with multiple shell companies abroad so if you look up the company name, it would appear to be hosted in your own country. Now, once you’ve been scammed your local law enforcement agencies wouldn’t be able to help because the case falls outside of their jurisdiction.
More Than A Scam – Sadly A Tragedy
The following is a video from the renowned Canadian TV program W5. It investigates the Binary Options schemes and shows the terrible and tragic consequences for several people, in particular the family of Fred Turbide who was robbed of over $300,000, his life savings. He took his own life.
A true story. The Canadian federal government and the provincial regulators became alarmed at some of these tragic stories that were unfolding so they decided to act. The man hired to lead the investigation received a robocall asking him if he wished to make good money working from home in binary options. Out of curiosity he decided to follow this up. Although the call seemed to come from elsewhere in Canada, he found it was routed from a couple of cities in the USA, then Latvia and ultimately from Israel.
How to not get scammed?
A quick Google search of the term “binary options” returns about 14,900,000 hits as of now. You’ll also see promotions saying, “Get 100% bonus,” “make up to 75 per cent every hour” and “91 per cent profit in one hour, all major trade markets.”
You’ll also notice these options going by the name of all-or-nothing, FROs (Fixed Return Options), digital options, commodities, stocks, indexes, and other derivatives. These sites self-promote by posing as low risk, high reward trading avenues that are easy to use and can be done by anyone from the comfort of their homes.
Whenever something new launches, let’s say a new financial instrument, it’s not uncommon to see a lot of businesses trying to get involved. Now, some of those businesses may be legit but some may not. This logic holds true in the case of binary options as well. If you don’t want to get scammed, the best thing to do would be not to get involved at all.
There are other plenty of investment opportunities online that can grow your portfolio. Stay away from whatever that promises to double your money or asks you to invest in a get-rich-quick program. There are countless ads and articles on the Internet on the topic of how to become rich overnight, and they all lead to one scam or another.
Conclusion 
Sure, the amounts you bet might be small, but the total can quickly add up if you do many trades a day. This sort of activity can even quickly become addictive especially if you happen to be someone who is a market junkie. No matter how knowledgeable or proficient you are in making market predictions; it wouldn’t take long for things to go out of control.
Lastly, most of these websites are unregulated, and no authority is protecting the people’s interests. Think of it as the Wild Wild West of Finance where anything goes, and justice is near to impossible to get. Binary trading is NOT investing – no matter what anyone says.
Outside sources of some of the material in this article:
https://www.forbes.com/sites/investor/2010/07/27/dont-gamble-on-binary-options/#717591f330a8
https://wealthrecoveryint.com/binary-total-scam/
https://www.binaryoptions.net/scams
https://www.timesofisrael.com/binary-options-an-israeli-scam-that-has-to-be-stopped/
Binary Tilt Scam – My Binary Options Story
I had tried to look at a way of making money online in one form or the other as I knew that there was no way that I could make enough money at my regular job.
At the time I had heard about binary options and there didn’t appear to be talk of it being a scam. but although it seemed to be too good to be true I still decided to have a long look.
I know. I should have known better but many of us think that maybe “this is different”.
The company I decided on was Binary Tilt.
Again, at the time I couldn’t find anything that said it was a scam, the company was registered as a New Zealand company, which is well known as one of the least corrupt nations on earth and generally highly respected. What I didn’t know was that New Zealand had some very loose regulations for companies registering in the country but as I was “only” investing $250, there was a limit to the amount of research I was going to do.
Naturally, Registration Was Easy
I registered for an account, sent the required documents and was trading in no time. At the time, I received a matching bonus equivalent to my original deposit, so I had $500 in my account – easy! They did advise me that this money couldn’t be withdrawn until I had made a few dozen trades or so, thus enabling them to make it back. This seemed fair and I was not thinking of cashing in anyway.
After a few weeks, I managed to turn that $500 into $100 and I received a call to work with a personal “coach” who would guide me. The account recovered nicely to about $700 and I started receiving many calls to invest much larger sums of money with basically a guarantee of substantial profits. This raised too many red flags, so I decided to cash in my account, now back to $300.
Withdrawals Not Easy With Binary Options Brokers
I received a call stating that as the balance in my account was basically “house money”, I was only entitled to the $50. I was too busy to deal with this so I left it for about another year and basically forgot about it.
When I revisited this a year later, I decided to trade this small amount like crazy with a ton of trades that went quite well and I finished with a flurry of pretty big winners before I called a halt.. My account was now at about $1,000.
Then I went back to BinaryTilt to get my cash out, not even worried if they wanted to keep the $250 bonus. When they finally answered, I was told that I had to verify my account before any withdrawal could be made. I had verified my account at the original setup but I had to do it again.
Part of the verification was that I had to send in copies of the credit card I had used when making my original deposit, some two or three years earlier – this card was replaced long ago (it was a prepaid, re-loadable card). I asked about that problem and now, a year and a half later, I am still waiting a response despite numerous requests for assistance.
Conclusion
Reading comments from many other people and now seeing that BinaryTilt, along with many other Binary Options schemes, have had scam warnings placed on them by various government regulators, I am not confident of getting my money back because nobody else seems to have any luck.
Finally, Some Potentially Positive News
If you want to find a legitimate, scam-free way that will teach you how to start your own online business so that you can make money from home, and that offers a free trial without leaving a credit card, then click the “Check It Out Here” button below. No, you won’t get-rich-quick (well I guess it’s possible, not likely though), but you will learn an entire new set of skills at your own pace, in the peace and quiet of your own home. No, you don’t even need to sell stuff.
