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The Manitoba Securities Commission (MSC), the finanicial regulatory body of the Canadian province of Manitoba, issued on Monday a warning against binary options broker Financial Market Trader, or FMTrader, operating as fmtrader.com, for providing financial services in Canada without being registered and authorized.
According to the regulator, the company is not in compliance with Manitola provincial securities laws, under which regulation fall binary options. The MSC has received a signal against the company.
“We recently spoke with a Manitoba resident who had invested $28,000 in Binary Options trades after discovering FMTrader through an ad on social media,” said Len Terlinski, investigator with MSC. “This investor was attracted by the promise of ‘risk-free trading,’ and ‘high profits.’ After investing $5,000 in cash and $23,000 via credit cards, the investor was told he couldn’t withdraw any money until he’d placed a minimum $1,000,000 in trades. Based on previous cases involving Binary Options, it is very unlikely this 24-year-old will be able to recover any of his investment.”
The regulator noted that the number of complaints against binary options companies has been on the rise. In Manitoba alone, investors have lost nearly $160,000 this year to unregistered, offshore Binary Options firms, trading under a variety of names, but, according to the MSC, losses may be higher since some investors do not report losses. There are no regulated binary options brokers or platforms in Canada.
In binary options trading, investors guess whether the price of a certain instrument would go upwards or downwards within a pre-determined time frame. Once the time is up, the option is deemed expired and the bet is settled. Depending on the outcome, a trader either collects a profit, or loses money.
Although binary options trading services are not illegal in Canada, in some countries, such as neighboring USA, this type of trading is restricted to exchange-traded only and there are two binary option exchanges – the Nadex and Cantor Exchanges.
The BCSC warns local citizens to be cautious when choosing financial intermediaries, especially if they are not registered to trade or advice local citizens.Canada’s regulators regularly issue warnings against unauthorized financial companies
In Canada, capital markets fall under the regulation of provincial watchdogs and legislation rules may vary in from province to province. The BCSC is in charge of the regulation of the capital markets in the British Columbia province. Under its legislation, binary options are regulated as securities under the securities laws.
We strongly advise you to only deal with regulated forex brokers, authorized by reputable regulatory bodies like CySec, FCA, and CFTC/NFA, among others.
FMTrader is a brand of Terapad Services, an entity based in Cyprus and part of Belize-licensed FM Marketing. The broker offers a wide range of binary options on currencies, commodities, stocks, and indices, including short and long-term binaries, pairs, one-touch and ladder binary trading.
Source: MSC