Release Number 7758-18

July 19, 2018

Federal Court in District of Columbia Orders “Prediction Market” Companies to Pay $3 Million Civil Monetary Penalty for Illegally Trading Binary Options and Violating a 2005 CFTC Cease and Desist Order

Washington, DC – The Commodity Futures Trading Commission (CFTC) today announced that on July 5, 2018, Senior Judge Royce C. Lamberth of the U.S. District Court for the District of Columbia issued an Opinion and Order (Order) against Defendants Intrade The Prediction Market Limited (Intrade) and Trade Exchange Network Limited (TEN), Irish companies based in Dublin, Ireland, requiring them to pay, jointly and severally, a $3 million civil monetary penalty for violations of the Commodity Exchange Act (CEA) and CFTC Regulations.

In ordering Intrade and TEN to pay a multi-million dollar civil monetary penalty, Judge Lamberth found, among other things, that Intrade’s and TEN’s repeated “violations severely compromised the regulatory purpose of the CEA and [were] serious” and, therefore, those “violations of the CEA and Commission Regulations, coupled with their brazen defiance of the 2005 Commission Order, warrant[ed] a CMP of $3 million.”

The Opinion and Order stem from a July 31, 2015 Memorandum Opinion and Order in which Judge Lamberth granted the CFTC summary judgment on Counts I and II of a Complaint filed against Intrade and TEN on November 26, 2012.  (See CFTC Complaint and Press Release 6423-12, November 26, 2012: CFTC Charges Ireland-based “Prediction Market” Proprietors Intrade and TEN with Violating the CFTC’s Off-Exchange Options Trading Ban and Filing False Forms with the CFTC.) 

In granting summary judgment to the CFTC, the Court found that TEN and Intrade permitted U.S. customers to trade 5,503 binary option contracts involving CFTC-regulated commodities from September 2007 through June 25, 2012 in violation of the CFTC’s ban on off-exchange options trading.  The Court also found that TEN violated a 2005 Cease and Desist Order that the CFTC issued against TEN for similar conduct by, among other things, (1) allowing U.S. customers to trade those 5,503 binary option contracts, (2) failing to have blocks in place for U.S. customers on 2,027 prohibited binary option contracts, and (3) lifting blocks on prohibited binary option contracts.  As a result, the Court permanently enjoined TEN and Intrade from further violating the CEA and CFTC Regulations but deferred a decision on disgorgement and a civil monetary penalty.  Subsequently, the CFTC voluntarily dismissed Count III and the parties reached a resolution in which Intrade and TEN disgorged and distributed to U.S. customers almost $250,000.

CFTC Division of Enforcement staff members responsible for this case are Kathleen Banar, James Deacon, Erica Bodin, Michelle Bougas, Mary Q. Lutz, and Rick Glaser. 

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See CFTC’s Binary Options Customer Fraud Advisory


The CFTC has issued a Consumer Alert to warn about fraudulent schemes involving binary options and their trading platforms.  The Alert warns customers that the perpetrators of these unlawful schemes typically refuse to credit customer accounts, deny fund reimbursement, commit identity theft, and manipulate software to generate losing trades.


Also, before investing or trading with a firm, check the firm’s registration status and disciplinary history, if registered, with the National Futures Association.  A company’s registration status can be found at:


Customers can report suspicious activities or information, such as possible violations of commodity trading laws, to the CFTC Division of Enforcement via a Toll-Free Hotline 866-FON-CFTC (866-366-2382) or file a tip or complaint online.