What are the warning signs of online binary options schemes
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He said no, but out of interest, researched the company online and the shares offered. One week later, they called Bob again. The warning signs Many scams in New Zealand come via cold calls. Hang up if you get an unsolicited call about an investment offer. If the call is from overseas — be extra cautious. Before you invest… Speak to a professional adviser Check the provider is licensed by us.
A licensed provider offers you greater protections. This is when things got ugly. Always ask if a company is licensed. Do your homework Check our lists of individuals, markets and businesses licensed or authorised to operate in New Zealand before you invest.
How John was targeted John was contacted by an Asian research company doing a survey of New Zealand businesses. The warning signs In hindsight, John recognised some warning signs: John now believes that by answering yes to this question he became a target. When John called them back a few days later, the same person answered the phone rather than a receptionist and this struck him as suspicious.
The online trading account had a Reuters newsfeed which suddenly disappeared. Be aware that sharing personal information with a stranger can leave you vulnerable to fraud or scams. Cold calls of any kind should be treated with suspicion.
Before investing, check that the business is legitimate. One of the two parties will make a loss — and it will not be the broker. Research the terms of trading and beware of any references to settlement figures based on anything other than real world prices.
So those are some key warning signs that should make any potential new trader stop and question what they are being told. If you have come across any of the above, identify the broker involved — and trade elsewhere. Even this however, might carry risk. The reason is, as well as the scam operators, there are review sites that are also dishonest. There are a couple of ways that consumers can protect themselves and find the trustworthy reviews.
The first method is in looking at the offerings elsewhere on the review site — if other scams are being promoted, then the reviews are not credible. Ask these question of the site:. The second method is regulation. If a binary option site lists FCA regulated brands as we do!
That site must be completely honest about the high risk nature of binary options, and it must have accountable individuals, based in the UK who operate it. If it does not, then the FCA firms would not allow their brands to be marketed by them. Here however, is another level of complexity. Some binary options brokers have sought to register with the FCA.
This is not the same as being regulated by them. A brand offering only binary options will not be fully regulated by the FCA. This is because binary options are currently regulated and licensed by the UK Gambling Commission. So the list of binary options brokers regulated by the FCA is actually very small. In addition to the services below, the FCA have published a list of firms who are not authorised to trade binary options in the UK.
While stopping short of calling them scams, the list provides a picture of firms who are prepared to break the law by offering unregulated trading. They are almost certainly best avoided. The list can be found here:. The marketing in use here is an obvious red flag. Unfortunately the claims are not true. The Brit Method is a scam that has been used before. Here is what you need to know to protect your money;. The Brit Method promises to be a binary options trading strategy that can make you hundreds of thousands of Dollars within a few weeks.
The Brit Method is nothing new. It previously was called the Aussie Method and the Canuck Method, and each time the site had to close due to its bad reputation.
Even the guy who supposedly invented the genius trading style is the same. There are many fake testimonials on the website, but make no mistake all of them are made up statements with stock pictures of people who never heard of the method. Similarly, all the promises made by the Brit Method are lies. The site essentially promises immediate, unlimited gains, but provides little information on how it wants to accomplish this goal. The site also promises to get you started for free, which is a lie, too.
But even if you make the deposit, you still wont have access because there is no system. The money is gone, and you will never see it again. Avoid the Brit Method at all costs. Also, be aware of all future version of the scam. The scammer encourages you to buy shares in a company that they predict is about to increase in value. You may be contacted by email or the message will be posted in a forum. The message will seem like an inside tip and stress that you need to act quickly.
The scammer is trying to boost the price of stock so they can sell shares they have already bought, and make a huge profit. The share value will then go down dramatically. Promoters make money by charging you an attendance fee, selling overpriced reports or books, and by selling investments and property without letting you get independent advice. High pressure sales tactics or false and misleading claims are often used to pressure you into investing, such as guaranteed rent or discounts for buying off the plan.
The offer may come from a financial adviser, or a scammer posing as one. Once they have your money, the scammer may take large 'fees' out of the released fund or leave you with nothing at all. There are certain exceptions such as severe financial hardship or compassionate grounds - but anyone who otherwise offers early access to your super is acting illegally.
If you think you have provided your account details to a scammer, contact your bank or financial institution immediately. We encourage you to report scams to the ACCC via the report a scam page. This helps us to warn people about current scams, monitor trends and disrupt scams where possible.