Israel and Binary Options
It is well known that there is a big problem with unregulated binary options brokers managing their companies (mostly the marketing and sales parts) from Tel Aviv and Ramat Gan. Even the Wikipedia page about binary options uses the word “Israel” 7 times and mostly in negative context. It is unknown how many unregulated brokers are managed by Israeli counterparts and how many legitimate binary options brokers that are regulated in the countries that they market and sell to are practicing their market making binary options arenas out of Israel. What is known is that the binary options ban reached Israel and that the ISA (Israel Securities Authority) is definitely not in favor of keeping up things the way they currently are. So What is going on in Israel with binary options is a question on many peoples minds. Here is a quick update:
- FinanceMagnates.com Reported Yesterday that “Israeli Watchdog Wants to Ban Marketing of Binary Options Abroad”
- TimesOfIsrael.com Reports Today That “Israeli regulator to attorney general: Give me the power to shut binary options”
So What Does This Mean?
Basically we already know that many binary options regulators from around the world have already posted warnings about binary options brokers, that are not regulated in their home country, that are marketing their products to locals. The issue is that binary options trading is banned in Israel but the Israeli companies keep on marketing the products overseas (without local regulation from those countries) and up until now none of the Israeli regulators and agencies have done much about it.
What we see now is that Prof. Shmuel Hauser, Chairman of Israeli ISA has asked the Israeli Attorney General for the green light to “shut down companies in Israel that sell fraudulent binary options to customers abroad by phone and the Internet” but this leaves us with more questions than answers.
- Out of the 100 or so binary options brands that are managed by Israeli counterparts, which ones will be left alone?
- Which Israeli led binary options brokers will be shut down and or prosecuted?
- How can you shut down the bad guys without hurting the good guys?
- What of the brokers that are regulated and do not participate in indecent practice?
- Will hundreds if not thousands of young Israelis loose there jobs even though they did nothing wrong?
Why Not Regulate?
The ISA has been going in the opposite direction. You don’t ban the whole trade in-house and then try to ban marketing overseas all-together to get the bad guys. The only good they are doing is shutting down a market with the potential to be lucrative for brokers, clients, marketers and everyone else. But just as Israel has done with gambling in the past, they have banned the whole market from operating in Israel, leaving the companies only two options, shut down or market overseas.
It has been said on some websites reporting about this issue that 2/3 of scam brokers operate from Israel. How exactly they found this statistic we don’t know. It also has been said by some that the whole entire binary options industry is one big fraud and that Israel is to blame. We also can not say if these statement are true or false. What we can say is that the Chairman of ISA is bringing the whole entire industry one step closer to being down on its knees in Israel, instead of doing what he is supposed to do – which is called “regulation“.