The Alberta Securities Commission (ASC) is warning investors of several unregistered binary option companies promoting online trading platforms that are currently soliciting Albertans, specifically in Edmonton and surrounding areas.
The ASC has recently received multiple complaints from Alberta residents who have lost significant sums of money investing through binary options trading platforms, the provincial regulator says.
Binary options are essentially “bets” as to whether the value of an asset will increase or decrease in a fixed (and often very short) period of time. Investors face only a few possible outcomes when the option matures; this is why binary options are sometimes referred to as “all or nothing” options.
Despite listing Canadian contact information, many binary options trading platforms are based overseas in countries such as Ukraine, Cyprus and Belize, the ASC says, and the companies managing these platforms are often not registered to conduct business or offer investment advice in Canada.
Being solicited to invest by companies operating offshore is a common red flag of investment fraud, and investing with these companies can be risky, says the ASC. Once funds are offshore, it can be nearly impossible for an investor to recover their money, the regulator warns.
The ASC is aware of the following unregistered trading platforms currently soliciting Albertans: VIP Binary Options; RB Options; Options XD; Citrader; GT Options; No 1. Options and Optek Canada.
Naming the companies does not mean that they have breached any Alberta securities laws, the ASC says.