Binary options scams are unfortunately quite common, as you can tell from our list of fraudulent brokers and services. If you’re concerned about falling prey, this guide explains how to avoid scams in the UK.

 

 

Is Binary Options a Scam?

In short, no. Binaries, in our opinion, are a good product. However, there are unscrupulous brokers and other service providers out there that hunt down uninformed traders. This is because binaries were largely unregulated and unattended when they first hit the market – which has fortunately changed a lot in recent years. But with scammers still around, what can consumers do to avoid binary options scams and focus entirely on their trading? Read this guide on scams and only trade with reliable brokers !

 

 

A scam listing can’t really help though – operators are closing and reopening so often that maintaining the list becomes a full-time job. A better option for consumers is to spot the warning signs, and if there is any doubt – simply switch to another supplier. A list of scams can only protect you from threats that exist today – learning how scam artists work and mislead consumers can keep you safe for years to come.

There are several methods by which binary options related scams will try and make money. However, there are also some pretty obvious red flags that can warn consumers in advance that all may not be well. As always, the old adage If something seems too good to be true, it probably is apply. If you encounter any of the below, I would advise you to be careful – and if in doubt, leave that particular broker – there are many legit, trustworthy brokers out there. There’s no need to take risks with any company you might be suspicious of.

Top 3 Trusted Brokers

For those who simply want to avoid scams and start trading without reading this entire guide, go with any of the following brokers:

Recuperate

A service called MyChargeBack.com provides counseling to help victims get their money back. They offer a free service to let you know if you have a case. Things like unpaid withdrawals or unauthorized payments may be requested through a bank or credit card company, which specializes in dealing with such institutions. The scope of services varies from case to case, but they can help:

 

How to avoid scams

Watch out for the warning signs listed below!

Cold call

A reputable broker is unlikely to attract new business by making cold calls and calling you out of the blue. It is likely that any call made this way, will involve unrealistic claims about binary options and potential profits to be gained from trading them. These may include the promise of high, immediate returns and lower all risks.

In addition to phone calls, some operators may also send direct emails, in some cases, indicating that an account has been opened. Any method of exposure is an immediate warning sign. Hang up and delete any messages.

Bonus Terms

One source of frequent problems is through deposit bonuses. Dishonest brokers will often have some extremely unethical terms. These may include tying to the initial deposit until a certain number of trades are met (revenue requirement). These will include the initial deposit (not just the bonus). Effectively make their deposit as soon as it is handed over. Be sure to read these terms before claiming a bonus, or making a deposit.

Don’t let someone else trade for you.

Automated trading

This alert includes automated robots and signals, but also managed accounts, where the account manager has promised great profits. There is a clear conflict of interest for these account managers. If you make a long term profit, the broker will make a long term loss on your account. An account manager, hired by the broker, is very unlikely to benefit your trading. While they may argue otherwise, letting someone else trade with you will most likely end up losing. These managers can also encourage traders to invest beyond their means, which is especially dangerous. Binary options are a high risk/high reward investment. The risks are never hidden from you by your broker or account manager.

Only trade with money you can afford to lose.

Marketing ‘Make Money Online’

Many of these warning signs are related – this form of marketing carries risks – like cold callers and account managers. The “ Make money online ” and “ Get rich quick ” marketing around binary options is obviously irresponsible. There are many websites, with highly produced videos that look very appealing. They will offer to make money really easy, maybe even ask them to copy famous investors. These are all scams. Any promotion that conceals, or detracts from, the high-risk nature of binary trading is dishonest. Binary options are not an easy way to make money and should not be sold this way. This form of advertising for binary options is generally the most dangerous for consumers. If you encounter this type of marketing, do not proceed.

Sales Channel

A channel is a website that will drive traffic to a broker. As a visitor to that website, you may not even know that you have been redirected to a broker. These funnels often operate the wealth marketing programs described above, but not always. The point here is that the consumer will be passed on to a broker who knows nothing about it. After accessing the channel, the new client will receive a call from a random broker asking for a deposit. While this may sound strange to those who haven’t fallen victim to it, the channel website’s effective binary options scam sale, will mean many people get scammed.

Deposit only with a broker you have chosen for yourself!

 

 

Price manipulation

Some brokers will include a line in their terms along the lines of: Our prices may not reflect actual market prices. Unfortunately, it won’t be so clearly worded, as the implications are obvious – they set their own prices. If the broker is the counterparty to any trade and they also set the price, it will be very difficult to make a profit with that broker. The client is trading with the broker and they decide the closing price. Either party will lose – and it won’t be the broker. Study the terms of the deal and be wary of any references to payment figures based on anything other than actual prices.

So those are some important warning signs that should make any potential new trader stop and question what they are being told. If you encounter any of the above, identify the broker involved – and trade elsewhere.

Alternatively, new traders can try and do their ‘due diligence’ on a brand. Even this, however, can carry risks. The reason is, as well as rogue operators, there are review sites that are also dishonest. There are a few ways that consumers can protect themselves and find trustworthy reviews. The first method is to look at services elsewhere on the review site – if other scams are being promoted, the reviews aren’t trustworthy. Ask these questions of the site:

  • Is there an evolution of robot advertising?
  • Does it promise high profits?
  • Is there full risk disclosure?
  • Can you contact the site, or the site owner?

The second method is regulation. In the UK, the Financial Conduct Authority regulates a number of binary options brokers. This only happens when the broker offers a form of trading that has been specified in the FCA – Contracts for Difference (CFDs), for example.

The reason this is so important is that FCA-regulated companies have to be careful about who promotes them.

If a binary options page lists FCA regulated brands (as we do!), this indicates a level of trustworthiness and protection. That website must be completely honest about the high-risk nature of binary options and it must have responsible, UK-based individuals operating it. Otherwise, FCA companies will not allow their brands to be marketed by them.

However, this is another level of complexity. Some binary options brokers have managed to  register  with the FCA. This is not the same as being  prescribed by them. For a company to be regulated by the FCA, they need to offer additional forms of trading, not just binary. A brand that only offers binary options will not be fully regulated by the FCA. This is because binary options are now regulated and licensed by the UK Gambling Commission. So the list of binary options brokers regulated by the FCA is really small.

Presenter

  • FCA – Consumer Consulting
  • British Gambling Commission Binary Options Trading  (Search for a list of licensed brokers from these pages)

FCA List of Unauthorized Brokers

In addition to the services below, the FCA has published a list of companies that are not allowed to trade binary options in the UK. While stopping to call them scams, this list provides a picture of companies that are prepared to break the law (by offering unregulated trading). They are almost certainly best avoided. The list can be found here:

FCA  unauthorized list.

Blacklisted services

Brit method

The marketing used here is a clear red flag. Videos suggesting more than £500k were made within a month is as obvious as it gets. Unfortunately, the statement is not true. This is a complete scam, avoid the Brit Method or any related scheme. These include Jason Taylor and any “millionaire producer” shows associated with that name, or The Brit Method.

The Brit Method is a scam that has been used before. Here’s what you need to know to protect your money;

What is the Brit Method?

The Brit Method promises to be a binary options trading strategy that can make you hundreds of thousands of dollars within a few weeks. Unfortunately, it’s the latest iteration of an old scam.

The Brit method is nothing new. It was formerly known as the Aussie Method and the Canuck Method, and each time the site had to shut down because of its bad reputation. Even the guy who is said to have invented the genius trading style.

Jason Taylor

It was always the same stock picture, just the name was changed from Jake Mason to Jake Pertu and now Jason Taylor.

There are many fake testimonials on the site, but none of them are made up of statements with stock photos by people who have never heard of the method.

Similarly, all of the Brit Method’s promises are lies. The site essentially promises instant, unlimited profits, but offers little information on how it wants to accomplish this goal.

The site also promises to get you started for free, which is also a lie. After you complete the free registration, you are denied access to the system unless you deposit $350. But even if you deposit, you still do not have access because there is no system. The money is gone, and you will never see it again.

Avoid the Brit method at all costs. Also, be aware of all future versions of the scam. In all likelihood, there will be the German Method and the American Method and they will most likely use exactly those methods to trick people.

Copy buffet

Again, sales are a clear red flag. This is a scam, stay away.

The scam shows that customers can enjoy wealth by following the method created by Warren Buffet. A famous investor with a long position, this fraud has absolutely no connection to Buffet himself.

This process involves visitors being forced to join a particular broker (another scam tactic explained above) and deposit money to gain access to a system down the road. No system exists and traders will not get any money back. Avoid.

Last transaction

The good news here is that the Ultimate4Trading website has been blocked for UK visitors. The activity is dishonest and should be avoided.

Planned Millionaire

Another scam again, thankfully blocked in the UK. Again, the promise to help the rich become the leader in marketing but the whole operation is a scam. To the extent that even the website is now a haven for malware. Get away

 

 

Instagram and Facebook

Many scams promote themselves on Instagram and Facebook. Most will fall into the categories listed above. The mainstream media has also been fooled in the past, including the Daily Mail. These promotions or accounts make strong claims of profits that can be made, backed up by pictures of flash cars and other successful traps. It’s all a lie and these activities must be avoided at all costs. If these people can really turn your £2,000 into £8,000 in a week – why do they need social media advertising? They can simply make as much money as they need from the markets and go and spend time on the beach. Screenshots are easy to fake – and they never need to show losing trades.

Anything that promotes a ‘get rich quick’ route using binary options is unreliable, full stop. It’s also important to remember that Martin Lewis (of popular MoneySuperMarket) is considering legal action because Facebook didn’t do enough to remove ads claiming to be supported by him. To repeat his quote,  Martin Martin Lewis does not do advertising . If an ad mentions him, avoid it at all costs – it’s almost certainly a scam.

Broker blacklist

Here are some brokers we have received reliable reports of poor customer care, or worse. Again, many of the tactics used are covered in our article on avoiding scams – this list is unfortunately not exhaustive so if any of the actions below sound like other brokers you’ve met, stay away from them – and let us know.

Many of the worst brokers have fortunately closed down, but always be aware of using unregulated brands unless you can verify their quality. Not all unregulated brands are unreliable, but it does mean that ‘more diligence’ is needed.

72Option

Bonus terms lock in initial deposit until x30 turnover requirement is met. Your deposits are yours until you choose to trade them. A broker should not block withdrawal of your deposit before it has even been traded. Avoid.

Opteck

Opteck is now closed for business. The stricter regulations introduced by CySec (follower Opteck) have left the company with no choice but to stop trading. Increased regulation is helping the industry by squeezing companies that use misleading, or deceptive, marketing to make money from customers.

Capital boss

Boss Capital is a well known broker that accepts US traders. The lack of strong regulations allows them to operate using questionable methods. They are another company that closed as a result of improved regulation.

StratX

StratX is a company noticed by a disgruntled customer (see page attestation ). The company uses cold calls, account management and makes withdrawals very difficult. Not recommended.

CFDStocks

Another company with which we have received a lot of correspondence is CFDStocks. They use most of the tactics discussed above, including cold calls. Most of the contacts we received said an account manager incentivizing larger and larger deposits before disappearing.

  • NRGBinary
  • WMOption
  • 24 hours
  • Option
  • Safety24Option
  • 777Binary
  • LBinary
  • BuzzTrade
  • CTOption
  • OneTwoTrade
  • PWRtrade
  • Big selection
  • GToptions
  • RBinary
  • Optional FM
  • The capital AG

If a broker is not listed here, it does not mean it is safe. While we try to list as many dishonest brokers as possible, new operators appear frequently. For peace of mind, stick to our reviewed brokers and use the comparison table to find the broker that’s best for you.

Details of Specific Scams

  • Google Trader – Scam Software Revealed
  • Managed Accounts – Alternatives
  • Binary options millionaire – real or fake?
  • Is this simply gambling?