Economy

UK Financial Conduct Authority Issues List Of Unauthorised Binary Options Providers

UK Financial Conduct Authority Issues List Of Unauthorised Binary Options Providers

The Financial Conduct Authority published a list of suspect firms in a fresh crackdown on "binary options" - high-risk, short-duration bets that have been dubbed the "biggest investment con in Britain" by Which?, the consumer group. The watchdog today issued a list of companies that are not conforming with the regulatory requirements in the UK. Most notably, the FCA doesn't stop with binary options brokers, its cautionary warning is directed towards affiliates as well.

The financial regulator has inherited the regulatory responsibility from the UK Gambling Commission that has been overseeing binary options until previous year. The action follows up on a Police raid which the Citi Police executed late a year ago.

Since 3 January the regulator has taken over the regulation of binary options from the Gambling Commission as part of the introduction of the new European regime and means firms offering this service must be authorised.

On Friday, the United Kingdom financial services watchdog released a list of 94 companies, which it understands are offering binary options trading to United Kingdom consumers without proper authorisation. Firms that are not authorised by the FCA and continue with binary options activities beyond that date will be acting in breach of section 19 of the Financial Services and Markets Act 2000 (FSMA), which is a criminal offence.

The full list of unauthorised binary options providers can be accessed via the firm's website.

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This list is based upon information that the FCA has received from consumers, partner agencies and from monitoring the binary options market.

The regulator confirmed it is in the process of examining each of the 94 firms to determine whether they are "genuinely operating from the UK". It said it suspects that numerous firms have registered false addresses and are in fact operating from overseas.

The chief City regulator has named 94 firms that it thinks may be illegally taking bets from United Kingdom investors and has threatened to prosecute them where it can.

The FCA's research on this area found the majority of consumers who invest in binary options lose money and find it hard to make sustained profits over a series of bets.