SEC charges Spot Option for $100 million scam on US investors

Rick Steves

Spot Option allegedly instructed its partners to permit investors to withdraw only a portion of the monies the investors deposited, devised a manipulative payout structure for binary options trades, and designed its trading platform to increase the probability that investors’ trades would expire worthless. The defendants allegedly made millions of dollars as a result.

Malhaz Pinhas Patarkazishvili (also known as Pini Peter) and Ran Amiran, former top executives of Israeli-based Spot Tech House Ltd (formerly known as Spot Option Ltd.) have been charged by the SEC with deceiving U.S. investors out of more than $100 million through fraudulent and unregistered online sales of risky securities known as binary options.

Spot Option has allegedly defrauded retail investors worldwide through a scheme involving the sale of online binary options, which included a proprietary trading platform with which developed white label partnerships.

According to the complaint, Spot Option instructed its white label partners to aggressively market the binary options as a highly profitable investments for retail investors, but investors were unaware the defendants’ white label partners were the counter-parties on all investor trades, which meant they profited when the investors lost money.

Spot Option allegedly instructed its partners to permit investors to withdraw only a portion of the monies the investors deposited, devised a manipulative payout structure for binary options trades, and designed its trading platform to increase the probability that investors’ trades would expire worthless. The defendants allegedly made millions of dollars as a result.

Melissa R. Hodgman, Acting Director of the SEC’s Division of Enforcement, commented: “Through our action against Spot Option and its executives, which follows a series of actions against others who allegedly used Spot Option’s binary option platform to victimize investors, we demonstrate our commitment to holding those at the top accountable. As these binary options cases show, investors should be on their guard whenever they see high-pressure sales tactics and too-good-to-be-true promises of returns or performance.”

Jennifer S. Leete, Associate Director in the SEC’s Enforcement Division, said: “Spot Option’s trading platform allegedly supported a worldwide binary options fraud. This action shows that the SEC will work with its foreign regulatory partners to pursue international actors who defraud U.S. investors.”

The complaint seeks disgorgement of ill-gotten gains, prejudgment interest, financial penalties, and permanent injunctions against all three defendants.

Read this next

blockdag

BlockDAG’s $28.5M Presale Ignites Investor Frenzy! Dashboard Upgrade Unveils Top Rankings, Overshadowing Retik Finance Listings!

Learn how BlockDAG’s updated dashboard, featuring detailed community rankings, is diverting investor interest from Retik Finance’s anticipated market entries.

Digital Assets

Gala Games reportedly hacked for $200 million, token nosedives

The native token of crypto gaming project Gala Games (GALA) dropped sharply amid rumors of a massive transfer worth over $200 million that traders suspected might be a hack.

Digital Assets

Ether skyrockets amid rumors of spot ETF approval

The chances of the U.S. government approving spot Ether ETFs have increased, according to top Bloomberg ETF analysts. Initially viewed as unlikely, analysts James Seyffart and Eric Balchunas now see a 75% chance of approval, up from 25%, following recent developments.

Digital Assets

New York judge approves $2 billion settlement with Genesis

A New York bankruptcy judge has approved a $2 billion settlement between the New York State Attorney General’s office and crypto lender Genesis, marking the largest settlement against a crypto firm in the state’s history.

Fundamental Analysis, Market News, Tech and Fundamental

Global FX Market Summary: Federal Reserve Policy, ECB, Geopolitical Tensions, May 20 ,2024

Fed holding rates to fight inflation, ECB likely cuts June rates, geopolitical tensions favor safe-haven USD

Digital Assets

Grayscale CEO steps down, replaced by Goldman Sachs veteran

Grayscale CEO Michael Sonnenshein after 10 years with the digital asset investment firm, the company said on Monday.

blockdag

Influencers Fuel BlockDAG’s $28.4M Presale Amid Solana Price Surge & Kaspa Bull Run

Dive into BlockDAG’s presale success, boosted by influencer endorsements. Explore the Solana price surge and Kaspa’s bullish sentiments.

Market News, Tech and Fundamental, Technical Analysis

EURGBP Technical Analysis Report 20 May, 2024

EURGBP currency pair can be expected to fall further toward the next support level 0.8525, which is the low of the previous corrective wave ii.

Digital Assets

Pump.fun exec arrested for $1.9 million exploit, claims bail in UK

Jarett Dunn, a former employee of the memecoin creator and trading platform pump.fun, claims he was arrested and subsequently released on bail in the United Kingdom following a $1.9 million exploit on the platform.

<