Quebec’s financial regulator seeks to ban certain types of binary options

Maria Nikolova

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.

Read this next

Digital Assets

Despite its legal troubles in the US, Ripple expands elsewhere

Ripple is looking to expand its presence in the MENA region, forming a new partnership with Pyyp, a global blockchain-based financial services technology company. The latter has reportedly joined Ripple’s On-Demand Liquidity (ODL) network, which, among many benefits, allows it to bring instant, low-cost remittances to its customers.

Digital Assets

Ripple’s string of wins analyzed, XRP lawsuit to drag on until Spring 2022

“Absent a settlement, this case will not be decided until March 2022 at the earliest and possibly not even until late spring if the court decides not to rule on some of the pending motions until after the discovery deadline, which looks really possible”.

Industry News

Stripe partners with BNPL giant Klarna

Stripe, one of the largest payment providers in the world, has announced the launch of a partnership with the BNPL giant Klarna which might prove to be a game-changer as far as the buy-now-pay-later industry is concerned.

Retail FX

ADSS’ UK business reports £3.09 million in 2020 revenues, down 38%YoY

ADSS’ FCA-regulated entity reported its financial results for the year ending December 31, 2020. The company posted a revenue figure that was 38 percent lower than the amount it earned in the fiscal year of 2019.

Retail FX

OANDA hires FX Global Code contributor Lisa Shemie as General Counsel

Lisa Shemie was Chief Legal Officer at Cboe and was part of several working groups under the Global Foreign Exchange Committee, which is responsible for the FX Global Code.

Digital Assets

Saxo Bank boosts Crypto FX offering after $2.5b in turnover since May

Saxo increased maximum position limits and several new crypto instruments, including the first ever US Crypto ETF issued by Proshares last week under ticker BITO.

Digital Assets

Tether tests Notabene for AML in cross border transactions

The Financial Action Task Force (FATF) has issued guidelines holding VASPs to the same standards as regulated financial institutions.

Digital Assets

Mobilum upgrades OTC crypto desk for trades above $50,000

Mobilum added a wide variety of crypto assets, fast settlements, no deposit or withdrawal fees, competitive trading fees, and a personalized service with human traders.

Digital Assets

Trakx launches digital asset trading platform in France

Crypto Traded Indices (CTIs) enhance portfolio diversification and reduce the complexity and fees associated with the setting and reach of positions on many digital and cryptocurrency assets.