Canadians increasingly being targeted by online ‘binary options trading’ schemes, regulators warn

Regulators are warning Canadians in regards to a spike in websites promoting “binary trading options platforms” accustomed to bet on how a stock or currency will work on the short time.

“No business is currently registered or authorized to promote or sell options in Canada,” the Canadian Securities Administrators warned Tuesday, adding that while investors may see virtual gains around the websites, they are often unable to collect the earnings because “they don’t exist.”

The CSA, an umbrella organization for Canada’s provincial and territorial securities commissions, warned that the options websites also expose investors to identity theft because they often request charge card information.

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Canadians who sign up “risk the threat of 1000s of dollars in unauthorized withdrawals on their charge cards as well as being tied to high-interest payments for a non-existent investment,” said Louis Morisset, chair from the CSA and leader of Quebec’s Autorit des marchs financiers.

The options platforms often operate offshore, according to the CSA.

“CSA members will work together and with other regulators to talk about best practices in order to counter these widespread illegal activities,” the regulatory umbrella group said inside a statement Wednesday.