France’s AMF reports closure of 138 binary options, Forex websites during three-year period
The regulator holds meetings with the High Court of Paris every two months to review proposals to close websites operated by illegal online trading entities.
France’s Financial Markets Authority (AMF) has earlier today provided data with regard to its actions against binary options and Forex firms that illegally target French residents.
The regulator notes that it has stepped up its efforts to combat the activities of such entities since 2011 when it first saw rapid multiplication of fraudulent offers by binary options and Forex brokers to French clients. Over a three-year period (since 2014), the regulator has secured the blocking of 138 fraudulent websites operated by online trading firms.
The efforts to block the websites are on top of the warnings issued to investors and the black lists which are regularly updated. AMF estimates the black lists of unauthorized Forex and binary options firms now include 445 entries.
To secure the blocking of the websites, the regulator has to turn to the High Court of Paris, with meetings held every two months (on average). In 2017, seven such meetings were held, resulting in the issuance of 25 orders by the Court that led to the closure of 52 web addresses of fraudulent brokers.
The regulator notes that it conducts follow-up checks of the blocked websites to make sure they do not resume their operations.
In April this year, France’s AMF Ombudsman – Marielle Cohen-Branche published the Annual Report for 2017, indicating that the volume of complaints concerning Forex and binary options trading has fallen. Nevertheless, she noted that concerns about fraudulent practices employed by companies active in this sectors remained.
The number of Forex complaints received in 2017 fell by about 50% from the preceding year, the ombudsman said, noting the positive effects of the work of the French financial markets authority AMF and the recently introduced Sapin 2 law. The latter prohibited all types of digital advertising and sponsorships related to toxic products like binary options.
The ombudsman received a total 1,361 submissions (enquiries, complaints, etc) in 2017, down 9% from 2016, and issued 506 opinions, down 5% from 2016 levels.
The investigated and closed files concerning Forex and/or binary options have resulted in 67 decisions in favor of investors in 2017. Almost all of these decisions were followed by the companies involved. This allowed to help investors recover EUR 1.05 million from a total of EUR 1.82 million of losses suffered. The sums that investors claim to have lost vary from EUR 250 to EUR 88,500. The average loss is EUR 17,646.
The European Securities and Markets Authority (ESMA) has said it would ban binary options offering to retail investors and would introduce restrictions to CFD offering but these measures have yet to come into force.