Binary Options: How to avoid scams
Binary Options, investing online has its risks.
Forex is a continually-evolving market. It is not true to say that there are no rules, because there are, but they are carefully monitored so as not to lose sight of important details.
Being unprepared or trusting the wrong people can cost you dearly.
When there is money at stake, you can be sure of a hidden scam somewhere.
Investing is never straightforward, but doing so online can increase the risks one hundredfold. Anarchy doesn’t rule the markets; it is not a world without rules. You can make a lot of money, but you can also be cheated very easily.
There are Forex regulations and the legislature safeguards against scams and the misuse of information and invested funds. The Web is full of promises of easy profits, behind which both competent businessmen and shady individuals are hidden.
To regulate the work of binary option brokers, who rely on financial mediation companies, there is the MiFID (Market in Financial Instruments Directive). The MiFID represents the legal code of Binary Option brokers. It is the MiFID that decides upon the rules that the binary option broker must respect if they intend to act legally.
Choosing authorised brokers is fundamental, because they are the only ones that end up being trustworthy. On the websites of regulatory bodies the lists of brokers closed down for transgressions is constantly updated.
To become certified with a regulatory body like CySEC and Consob, brokers are, amongst other things, expected to pay a guarantee fund to cover the deposits of investors to guarantee them in case of financial failure.
Those intending to invest in binary options might find it advantageous to trust a broker that has obtained their working licence from CySEC and Consob.
If digital security is respectable, every procedure that is carried out and every connection with financial markets happens on frequencies that are encrypted to guarantee reliability, discretion and data-protection.
To monitor, but also to be monitored.
Traders know that they also have rules that must be known and respected.
Above all you must be ready to provide information from your own current account to make payments and withdrawals, in order to allow monitoring authorities to check for money laundering.
Every profit that is earned by means of investment in binary options can only be withdrawn with a current bank account.
It is also important to be aware of the existence of a penalty in case of a missing trading amount that is always mentioned in the “terms and conditions” of the binary options broker.
Those who deposit but do not invest, or do so using a small portion of the amount transferred, may have to pay this penalty in order to withdraw all of the money or the money that remains. In order not to pay commission, you need to use up all of the deposit before withdrawing.
The bonus itself, treated like a generous gift, can prove to be a double-edged sword if linked with the amount being traded. Reading every clause is fundamental. If you are not able to comply with the necessary obligations to obtain a bonus, it is better to turn it down.
Trick or Treat
The difference between transactions carried out on certified websites and those completed elsewhere consists in the quality of the service and in the final yield. If a broker is reliable you will not encounter any tricks, like seeing a current operation slowed down with a subsequent loss of a profit that seemed secure.
The biggest trap is getting yourself caught up in money laundering.
You could deposit clean funds and, without knowing it, you could find that the money you withdraw has come from illegal sources.
Whatever controversy that you might be presented with, if those acting for you are certified, it can be resolved with the mediation of the regulatory bodies (CySEC, Consob, Fsa…) who have the power to suspend or impose fines on platforms that do not conform to regulations. The situation can also be resolved thanks to consultation with expert lawyers in the sector, like those at Boccadutri International Law Firm, who are attentive observers of the dynamics of new markets.
When you want to check the reliability and certification of a broker you must always pay attention to the real name of the company behind the site.
Consob has been safeguarding binary options since 2012.
Since as early as 2012, Consob, has communicated to the public the growing phenomenon of binary options, which it has defined as a “similar structure to gambling”.
Being considered true and proper “instruments of investment” it asked the companies that were interested in providing investment services with binary options to be provided with special authorisation.
For its part, it confirmed the pursuit of “investigations into contracts for listed qualifications, on the abuse of insider information, stock manipulation or of possible manipulations of the market.”
What makes one Broker better than another
There are many factors to take into consideration when entering the world of binary options.
- Commitment to a certified corporation.
- Knowledge of the type of bonus offered.
- Connection between native language and assistance given
- Percentage of profit
- Potential limitation of losses through reimbursements
- Scope of the offer
- Presence (or absence) of profit on top of the trading amounts
Knowing the rules of the game is important.
If you come across binary option trading that doesn’t seem quite right, do not hesitate to contact our expert lawyers who will help you find the right solution.
Contact our lawyers by filling in the application form here.
Complete the form to request a legal consultation. Our experts will evaluate your case and suggest the best solution.