Most of the binary options market is operated through web-based trading platforms. It is not necessary for a trading platform to comply with regulatory requirements. That’s why it is likely that a particular trading platform may be involved in illegal activity. You are most likely to get scammed when it comes to binary options. Let’s look at some of the scams you may face when trading in binary options.
Identity theft
When you contact a binary options brand, they ask you to provide them with your identity documents, such as copies of passport, driver’s license and credit cards. Scammers can use this personal information for unspecified purposes, and you will never realize that. So, it is recommended that you do not provide them with your personal data.
Manipulation of the trading platform
Many customers have complained that web-based binary options companies manipulate the trading software. In this way they are able to distort the payouts and binary options trades. If you are winning on a bet, they may extend the countdown to expiration that may result in a loss of trade.
Binary Trading Scam – Refusal to Withdraw
When you start trading binary options, you deposit an amount of cash in your binary options trading account. In some cases, brokers encourage customers to deposit additional funds into the customer account. But later on, if you want to withdraw the deposited funds or the trade returns on the deposited money, brokers will refuse to release the funds – this the binary trading scam. Your withdrawal requests will be canceled and your account will not be credited. Your amount will not be reimbursed. The brokers will ignore your calls and emails. That’s how they plunder customers’ money.
How to Not Fall Prey to Binary Trading Scams
You have to check out the background of the brokerage you are depositing money with. You should see their registration and license status of the firm or any other financial professional you have selected for trading purposes. You can confirm their identity through the SEC’s Investment Advisor Public Disclosure (IAPD) database. You can also look them up through the National Futures Association Background Affiliation Status Information Center’s – BASIC Search. A rule of thumb to ensure that you don’t fall victim to a binary trading scam is to only select those who are registered. Ignore the rest no matter how charming and lucrative their offer be. Never ever give them money. And as for personal information, it is a big ‘no.’ You don’t know where your information will be used.
But despite all the precautions, sometimes investors still fall a prey to a binary options scam. There are so many companies and trading platforms in the market that it is quite hard to select the right one. It is also possible that a registered trading platform is involved in scamming. Binary options trading scams online are very common. If you are caught in the trap of a binary options scam, it is the last thing you expect as an investor. All your investment can be lost if the case is not properly handled. If you have fallen victim to a binary options scam, you should consult with an experienced asset recovery agency or expert attorney who can recover your investment.