Social media ad leads another Manitoban to financial peril
Winnipeg - The Manitoba Securities Commission (MSC) is cautioning the public on investing with so-called ‘Binary Options’ firms. MSC recently received a complaint regarding fmtrader.com, a company purportedly located in Cyprus and Belize, which is not registered to sell securities in Manitoba, or anywhere else in Canada. The company is not in compliance with provincial securities laws. This is one of a growing number of recent complaints regarding Binary Option firms.
“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.”
This year, Manitobans have reportedly lost nearly $160,000 to unregistered, offshore Binary Options firms, trading under a variety of names. MSC suspects losses may be higher due to unreported cases.
Binary Options are a sort of ‘wager’ where investors bet on the performance of an underlying asset, often a currency, stock index or share, usually in a short period of time—sometimes minutes or even seconds. When that period is up, the investor receives a predetermined payout or loses his wager. It’s an “all or nothing” proposition. With some of these offshore investments, no actual trading takes place and it is just a tactic used to steal an investor’s money. A request to send your money offshore to an unregistered firm is a red flag for investment fraud.