May 7, 2014
CFTC Amends Complaint against Banc de Binary, Ltd. to Charge Three Affiliated Corporate Entities with Violating the CFTC’s Ban on Trading Options Contracts Off-Exchange
CFTC Also Charges Oren Shabat Laurent as the Controlling Person of the Corporate Defendants and of the Banc de Binary Common Enterprise
Washington, DC – On June 5, 2013, the U.S. Commodity Futures Trading Commission (CFTC) filed a civil Complaint in federal district court in Nevada against Banc de Binary, Ltd. (incorporated in the Republic of Cyprus), charging it with violating the CFTC’s ban on off-exchange options trading by offering commodity option contracts to U.S. customers for trading, as well as soliciting, accepting orders and funds, or confirming the execution of orders, from U.S. customers (see CFTC Press Release 6602-13). Today, the CFTC is announcing that on May 6, 2014, it filed an amended Complaint in this action (see Related Links), charging three corporate affiliates of Banc de Binary, Ltd. – E.T. Binary Options Ltd. (incorporated in Israel), BO Systems Ltd., and BDB Services Ltd. (both incorporated in the Republic of Seychelles) – also with violating the CFTC’s ban on off-exchange options trading by offering commodity option contracts to U.S. customers for trading, as well as soliciting, accepting, or confirming the execution of orders from U.S. customers during the period from May 2011 through at least March 2013.
In addition, the CFTC’s amended Complaint adds Defendants E.T. Binary Options Ltd. and BO Systems Ltd. to the charge that they, and Banc de Binary, Ltd., operated as unregistered Futures Commission Merchants (FCMs) during the period from July 2011 through at least March 2013.
Finally, the amended Complaint charges that during the relevant period Oren Shabat Laurent, a citizen of the U.S. and Israel, controlled the Banc de Binary common enterprise and, thus, is liable for the corporate Defendants’ alleged violations of the Commodity Exchange Act and the CFTC’s Regulations.
The amended Complaint charges that all four of the corporate Defendants operated as a common enterprise, each one individually and collectively, operating under the trade name “Banc de Binary.” The amended Complaint charges that these corporate Defendants, individually and/or as part of the Banc de Binary common enterprise, operated an online trading website permitting U.S. customers to trade binary options products prohibited by the CFTC’s ban on off-exchange options trading.
Through the website www.bbinary.com (and affiliated websites), the Banc de Binary common enterprise allegedly unlawfully solicited and permitted U.S. customers to buy and sell options betting on the prices of wheat, oil, platinum, sugar, coffee, corn, foreign currency pairs, and stock indices and did not limit its options offerings to eligible contract participants, allowing U.S. customers to trade without requiring any information about their trading history or net worth.
In its continuing litigation against the Defendants, the CFTC seeks civil monetary penalties, and other remedial ancillary relief, including restitution, disgorgement, and rescission and a permanent injunction preventing the Defendants from engaging in certain commodity options activity with U.S. customers.
CFTC Division of Enforcement staff members responsible for this case are David S. Slovick, Margaret Aisenbrey, Jessica Harris, Mary Lutz, Kathleen Banar, and Rick Glaser.
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See Binary Options Customer Fraud Advisory
The CFTC’s Office of Consumer Outreach and the Securities & Exchange Commission’s Office of Investor Education and Advocacy 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 schemes allegedly refuse to credit customer accounts, deny fund reimbursement, commit identity theft, and manipulate software to generate losing trades.
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.
Last Updated: August 6, 2014