Binary option brokers TitanTrade and Novox Capital Ltd., operating as Option Stars and OptionStarsGlobal, have been added to the warning list of Canadian provincial financial regulator British Columbia Securities Commission (BCSC), data issued on the watchdog’s website indicated on Wednesday.
The entities are not registered to trade in, or advise on, securities or exchange contracts in the province and are therefore not authorized to provide such services there. Nevertheless, they have been targeting British Columbian citizens and offering them to open trading accounts.
Both brokers offer platforms for trading in various types of binary options on currencies, stock, indices and commodities. Neither of them provides information regarding regulation or authorization.
TitanTrade, www.titantrade.com, claims to be based in Belize and provides phone numbers for contacts in the UK, Russia, Australia, South Africa, and Spain. It promises up to 85% profit and up to 100% bonus on clients’ first deposit. No demo accounts are available with TitanTrade and the required minimum deposit is $250. TitanTrade has made it to the warning lists of other regulators, too – Italy’s CONSOB, Australia’s ASIC, and New Zealand’s FMA.
Option Stars, www.optionstars.com, and OptionStarsGlobal, www.optionstarsglobal.com, have identical websites and claim to be affiliated to a company named New Markets SA which is based in Samoa. According to the Canadian regulator, it also claims to be based in Bulgaria. The broker provides contact phones in the UK, Germany, Canada, and Australia. The minimum deposit requirement for the different account types it offers starts from $1,000. The broker promises a client insurance of up to € 20,000, but it does not elaborate under what conditions or from what fund the amount would be available.
In Canada, capital markets fall under the regulation of provincial watchdogs and legislation rules may vary in from province to province. Binary options are not forbidden throughout the entire country, but providers of such instruments need to be regulated in order to operate. However, there is not a single binary options broker or platform authorized or licensed to operate in Canada. Under the BCSC’s legislation, binary options are treated as securities.
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.
When engaging with unauthorized and non-regulated brokers, traders are putting their investments at higher risk. We strongly advise you to only deal with regulated forex brokers, authorized by reputable regulatory bodies like CySec, FCA, and CFTC/NFA, among others.