Quebec’s financial regulator seeks to ban certain types of binary options
Quebec’s watchdog states that binary options platforms are “run by people who are acting illegally and embezzling victims’ funds” but stops shorts of proposing an outright ban on all sorts of binary options.
FinanceFeeds’ has been keeping you updated on the latest measures taken by regulators and enforcement agencies to stop fraudulent binary options schemes.
Quebec’s regulator seems to have woken up to the fact that public warnings against certain binary options providers do not do much to prevent investors from losing hefty amounts of money. Today, Quebec’s financial markets authority (AMF) unveiled its plans to amend the Canadian province’s Derivatives Regulation in order to formally prohibit the offering of specific kinds of binary options to Quebec investors.
Interestingly, the watchdog stops short of imposing a blanket ban on offering of all sorts of binary options. Instead, its proposals envisage a ban on binary options with expiries of less than 30 days. Apparently, Quebec’s AMF believes that certain types of binary options are harmless.
Nevertheless, AMF President and CEO Louis Morisset admits that:
“Binary option platforms generally promise fast profits which are not paid out to investors. They’re run by people who are acting illegally and embezzling victims’ funds”.
Quebec’s regulator has opened a consultation on the proposals. The draft Regulation to amend the Derivatives Regulation, comes with a 30-day comment period.
Quebec’s financial markets watchdog joins a growing group of regulators trying to take more decisive measures to tackle binary options fraud. Under the “Sapin 2” law, France has recently introduced a ban on all sorts of advertising of high-risk financial products, including binary options.
Whereas regulators mull how to act against fraudulent schemes involving binary options, EUROPOL has also thrown its weight behind this fight. This is considered as a particularly good piece of news, as the enforcement agency has powers that national financial regulators do not have. EUROPOL, for instance, may prosecute employees of binary options brokers, including sales representatives who often use aggressive and manipulative techniques to solicit investments. Thus, EUROPOL’s intervention is expected to be more effective than the warnings and statements issued by national financial regulators.