Legal Law Administration’s Binary Options Trading Litigation team has received a considerable number of complaints from international investors regarding Banc de Binary, a binary options broker founded by Oren Shabat Laurent, an American/Israeli citizen who lives in Tel Aviv. Mr.Laurent is permanently barred from doing business in the United States or with any US citizen.

Legal Law Administration’s Forex and Binary Options litigation team is currently investigating the complaints against Banc de Binary relating to fraudulent binary options trading. Banc de Binary is a Cypriot and Israeli investment firm trading in binary options together with ET Binary Options Ltd, BO Systems Ltd and BDB Services Ltd. Legal Law Administration is contacting investors and traders who have lost funds with Banc De Binary and offering an immediate review of their matter.

In view of the large number of complaints already received, our lawyers have already reported these complaints to the Commodity and Futures Trading Commission, (CFTC), the European Securities and Markets Authority, the Cyprus Securities and Exchange Commission, the Israel Securities Authority, the Ontario Securities Commission, the Swiss Financial Market Supervisory Authority, the Securities Commission in Italy (CONSOB), the Australian watchdog ASIC, the New Zealand watchdog FMA as well as the U.K. Financial Conduct Authority pursuant to the recent “Memorandum of Understanding on the cooperation and exchange of Information” between the USA and Europe.

We expect that these authorities will fulfil their respective regulatory mandates in the context of supervising Banc De Binary internationally, particularly in the areas of protecting customers, fostering the integrity of and maintaining confidence in financial markets and to reduce systemic risk across the binary options industry.

Banc de Binary has been included in the crackdown of hundreds of brokers by multiple regulatory bodies and has received warnings and fines but no regulator has ever officially branded them as perpetrating a scam or conducting a fraud. Whilst our investigations are still ongoing, there are various areas of concern which may be used by clients as grounds to issue legal proceedings against Banc De Binary before an English or Cypriot court:

• Banc De Binary acts as the counterparty to their customers’ binary options transactions on a variety of assets, including commodities (e.g., wheat, oil, gold, platinum, sugar, coffee, corn, etc.), Forex pairs (e.g., EUR/USD, GBP/USD, USD/JPY, etc.), and stock indices (e.g., S&P 500 and NASDAQ futures).
• The customers may not be eligible contract participants as they may be retail customers.
• In relation to customers based in various jurisdictions such as the USA, Canada and Australia, these binary options transactions promoted by Banc de Binary violate federal laws prohibiting the trading of options off-exchange

Through its websites, Banc de Binary customers buy or sell binary “call” or “put” options that allow them to predict whether the price of a certain “asset” will go “up” or “down” at a future date and/or time, with a specified payout structure.

According to Banc de Binary’s European website www. eu.bancdebinary.com, the organisation is owned and operated by Banc De Binary Ltd., a company regulated since January 2013 by the Cyprus Securities and Exchange Commission (Cysec) and it is fully authorised as a credit/financial institution to undertake business in the UK and as an “authorised service provider” in Europe in accordance with the Markets in Financial Instruments Directive (MiFID) by the Financial Conduct Authority (FCA). The documents filed at Companies House identify one of its directors is a Mr Yehezkel Shabat, who is also an Israeli citizen resident in Tel Aviv.

The other domain www.bancdebinary.com is owned and operated by Ash Ltd (registered in St Vincent in the Caribbean) and its affiliated company Aster Services Ltd. in Bulgaria which also acts as a payment processor. We refer to these companies collectively as “Banc de Binary” as they both conduct business internationally through this brand.

History of Banc de Binary regulatory breaches

In May 2013, Banc De Binary Ltd. was also incorporated in the UK to provide “market research and brand promotion in the UK”. Its address at 1 King Street, London, EC2V 8AU, like its New York City address at the Trump Tower, is a virtual office with no physical staff presence.

In June 2013, Banc de Binary was charged by both the CFTC and the USA Securities and Exchange Commission (SEC) for alleged violations of US financial regulations and, one month later, the SEC obtained a preliminary injunction from the U.S. District Court in the District of Nevada to prevent and freeze any further trading with US customers.

In August 2013, charges were filed in the US stating that Banc De Binary “may be criminally liable under the federal RICO statute” Racketeer Influenced and Corrupt Organisations Act. In these US civil suits, the SEC and CFTC alleged that Banc de Binary offered off-exchange trading options to US customers and unlawfully solicited US customers to buy and sell options, and furthermore, that the company also failed to complete credit checks on customers to ensure that those with low finances did not trade with them.

In April 2014 CySEC imposed an administrative fine of €10,000 for breach Article 139(2) of the Investment Services and Activities and Regulated Markets Law of 2007 after it found that Banc de Binary had “concealed material information in its request for authorisation, namely concealed the existence of close links between it and another company”.

In March 2016, a US federal Court ordered Banc de Binary Ltd., ET Binary Options Ltd., BO Systems Ltd., BDB Services Ltd. (collectively, Banc De Binary) and Oren Shabat Laurent to pay More than $9 million in restitution and a civil monetary penalty to U.S. customers who traded the illegal, off-exchange options offered and for violating the CFTC’s Ban on Trading Binary Options Off-Exchange. The Order also imposed a permanent ban on offering or trading any further off-exchange binary options to U.S. customers.

In October 2016, the International Financial Services Commission of Belize issued a public notice on its website confirming that Banc De Binary and BDB Services (Belize) Limited with its registered office at No. 5 Cork Street, Belize City, Belize, C.A. were no longer licensed by the  IFSC due to non-compliance to some conditions of the original licence granted for ‘Trading in financial and commodity-based derivative instruments and other securities’.

The swift decisive action delivered by the American regulators, SEC and CFTC, is an example to the financial watchdogs around the world.

Legal Law Administration will continue to fight vigorously for the protection of customers and to ensure the wrongdoers are held accountable.

If you are a victim of Banc De Binary and have lost funds with this binary options broker, please click here to arrange a discussion with a lawyer in the Binary Options Litigation team.