SEC goes after binary options fraudsters behind LBinary and Ivory Option
Anton Senderov and Lior Babazara a/k/a Lior Bar, are accused of defrauding more than 2,800 US investors and causing them to lose over $5 million.
The United States Securities and Exchange Commission (SEC) keeps up its efforts to put an end to binary options scams. On October 9, 2019, the SEC charged two Israeli individuals, Anton Senderov and Lior Babazara a/k/a Lior Bar, with defrauding more than 2,800 US investors and causing them to lose over $5 million through online sales of binary options.
The SEC’s complaint alleges that Senderov and Babazara defrauded investors through two online binary options brokers they controlled, LBinary and Ivory Option. The defendants also owned and controlled LianTech Finance Marketing, Ltd., which operated a call center in Israel that functioned as a “boiler room.”
According to the SEC’s complaint, employees at the call center allegedly persuaded investors to open binary option trading accounts and deposit significant sums into those accounts. Call center employees lied to investors about their professional backgrounds and falsely told investors that the brokers earned money only if investors made money. In reality, the brokers earned money only from investor losses and therefore had no incentive to advise investors on how to trade binary options profitably.
Most investors lost money, with some losing their entire savings. The binary options brokers largely refused to honor investor requests to withdraw money from their trading accounts.
The SEC’s complaint, filed in federal district court in the Eastern District of Washington, charges Senderov and Babazara with violating the securities registration provisions of Sections 5(a) and 5(c) of the Securities Act of 1933. The duo is also charged with violating Section 20(a) of the Securities Exchange Act of 1934 (Exchange Act) by acting as control persons for LianTech, LBinary, and Ivory Option’s uncharged violations of the antifraud provisions of Sections 10(b) and 15(a) of the Exchange Act and Rules 10b-5(a) and (c) thereunder.
The regulator seeks disgorgement of ill-gotten gains, prejudgment interest, financial penalties, and permanent injunctions against the defendants.
Let’s recall that, about two weeks ago, the SEC filed a complaint against Peter Szatmari. Between 2014 and 2016, Szatmari participated in the creation and dissemination of at least six false and misleading marketing campaigns designed to persuade potential investors, predominately in the United States, to open and fund binary options trading accounts with overseas unregistered brokers operating on the Internet. The misleading websites and videos were viewed by more than 350,000 persons and caused more than 25,000 investors to make deposits for trading binary options with one of approximately 35 unregistered brokers.