Binary options fraud involving education gathers pace

Maria Nikolova

“They set him up with webinars, he was thinking he was getting educated, understanding the system, the market…”, says Tomas, son of 61-year old victim of binary options fraud.

The story of 61-year old Fred Turbide, of Edmonton, Canada, who took his life in December 2016 after suffering hefty financial losses over binary options trading, is an example of the horrific consequences of binary options fraud.

Mr Turbide’s family recently shared their sad experience in a video interview with the Alberta Securities Commission, in which some of the key fraudulent tactics used by binary options fraudsters are mentioned. Amid these is the active solicitation of potential customers by offering them educational services, creating the illusion of understanding and the ability to master the market.

In the video, Tomas, son of the victim, tells of this approach being used by the binary options firm to lure his father.

“They set him up with webinars, he was thinking he was getting educated, understanding the system, the market… He really felt he was in a really good position to make a bit of money out of it”, says Tomas, son of the victim.

To assess the scale of this “pro-educational” approach FinanceFeeds has checked a number of blacklists of binary options firms. The so-called RED List, or Registration Deficient List, composed by the Commodity Futures Trading Commission (CFTC), for instance, currently features 111 names of binary options and FX firms that are foreign entities acting in an unregistered capacity, that is, they have no permission to target US customers. All of the binary options firms featured on the RED List are offering “education” services to their customers.

A number of catches come along with these offers. The most common ones concern the quality of the “trading manuals”, webinars, seminars, as well as the price to be paid for such services.

When trying to access such services, FinanceFeeds’ Managing Editor was several times redirected to trading platforms where she had to execute trades in order to get access to binary options classes. It turned out she did not have to trade much – as the program was trading on its own, showing messages of trades opening and closing, and options expiring. Let’s also note the heavy volume of malware that gets automatically installed on one’s computer should a person make the mistake of opening a binary options trading platform.

This problem was underlined by French financial markets regulator AMF in its latest mystery shopping tour targeting FX/binary options brokers. Whereas pretty much all of the companies checked by the mystery shoppers advertised educational services on their websites, the adverts were often misleading. Half of the tested companies did not in reality provide the education services advertised. Moreover, the information was not adapted to the level of knowledge of the specific client.

Canada’s authorities are now proposing a ban on advertising, offering, selling or otherwise trading a binary option to an individual. The period for public comments expires on May 29, 2017 in Alberta and Quebec.

  • Read this next

    Digital Assets

    Shiba Inu Enhances Privacy & Security with New Encryption

    SHIB, the force behind the Shiba Inu cryptocurrency, today introduced Fully Homomorphic Encryption (FHE) into its platform, ensuring unmatched data protection for its users.

    Digital Assets

    Binance Broadens Its VIP Invitation Program for Traditional Asset Traders

    Step Into the Future of Trading: Binance Invites Traditional Asset Traders to Join Its Exclusive VIP Program

    Digital Assets

    Algotech Presale Revolutionizes DeFi Scene, Surpassing $1 Million Raised in Just Weeks

    Emerging Cryptocurrency trading platform Algotech (ALGT) known to be famous with its cutting-edge features. The TradFi platform features advanced algorithms to provide a competitive edge to traders. 


    Revolut enables direct transfers from Singapore to Bangladesh and Kenya

    British fintech firm Revolut has broadened its array of services with the introduction of the “Mobile Wallets” feature in Singapore, facilitating direct money transfers to Bangladesh and Kenya.

    Digital Assets

    SBF claims “zero loss” to FTX customers, 100-year sentence is “grotesque”

    Sam Bankman-Fried, the former FTX CEO who was found guilty of fraud charges last year, is facing his sentencing next month. But before that day arrives, he’s making a plea for what he considers a fair shake.

    Digital Assets

    Bitcoin nears $62,000, sparking retail buying frenzy

    Bitcoin dashed past the $61,000 barrier on Wednesday, a peak it hadn’t touched since the waning days of November 2021.

    Market News

    OPEC+ Extension of Oil Output Cut Causes Rally

    The dynamics surrounding crude oil are indeed fascinating, given its unique role as both a globally traded commodity and a vital energy source deeply influenced by the OPEC+ alliance’s decisions.

    Institutional FX

    DKK reports 226% growth in 2023 with eyes on African expansion

    “Our numbers are beginning to show how we are powering, the growth required by emerging markets, and we plan for the success of our strategies to continue to thrive in 2024.”

    Industry News

    ‘WTF’ as in ‘What The Fraud?’, Sumsub’s new podcast on digital fraud

    “We found a lack of informative podcasts talking about digital fraud threats and prevention for business owners. So, we decided to dive in and share our expertise along with industry top minds in the ‘What The Fraud?’ podcast.”