Regulators launch task force to raise awareness on binary options scams

TORONTO – Canadian securities regulators have formed a task force to raise awareness and help protect investors from so-called binary options scams.

The Canadian Securities Administrators says the number of victims affected by this form of fraud is on the rise.

In a binary option scheme, an investor bets on the performance of an underlying asset like a currency, stock index or individual stock and receives a payout or loses the entire amount depending on what happens. The time frame on the bet is typically very short, sometimes hours or even minutes.

The council of provincial and territorial securities regulators says there are no registered individuals or firms permitted to trade these products in Canada.

The task force is working with online advertisers and mobile companies to eliminate binary option advertising and mobile apps in Canada.

It’s also co-ordinating efforts with international organizations and working with credit card companies and financial institutions to cut off funding.