Ever since binary options became a recognized financial product a lot has been said about the regulatory framework and the regulating authorities. Indeed, many have argued that regulation is of little significance to traders interested in binary options and that those wishing to trade in forex instead place much more significance to whether a broker is regulated or not.
Moreover, Cyprus as a jurisdiction and the local regulator there, the Cyprus Securities and Exchange Commission have repeatedly come under fire for being too lax with brokers, for “offering a flag of opportunity” with their CIF status. More recently critics argued that several brokers have decided to turn their backs on CySEC regulation considering it too much of a hassle and not worth their while.
If all of these were true however, then the industry would not have been plagued by several impostor sites, which either claim to be something else or which falsely portray themselves as being regulated in Cyprus when in fact they are not.
CySEC appears determined to nib such phenomena in the bud and this is why it seems to have lately increased the frequency by which it issues announcements, warnings and fines in this regard, in an attempt to crack down on crooks.
The latest companies to added to the list against which CySEC has issued warnings are a company offering forex services, namely “Frontiers Group Investment Ltd” which operates through http://frontierforex.com and a company offering binary options trading “Mercuria Technologies Ltd”, which operates through the domain www.optionsmarter.com.
With two separate warnings issued on 21 March 2014, CySEC informs investors that none of the two above named companies is a regulated entity under its jurisdiction and that none of them is permitted to provided investment and ancillary services in the Republic of Cyprus as CySEC has never granted them the authorization to do so.
Currently the domain www.optionsmarter.com is still up and running and still cites on its page that it is based in Cyprus, in what could be perceived as a statement misleading potential investors. On the other hand, http://frontierforex.com is currently inaccessible as it appears to have been suspended. This company’s false claims were graver as cached versions of their site reveal that they were actually claiming to be regulated by CySEC as such, which is a pure lie.
No matter what anyone might maintain it is undeniable that trading through recognized, regulated and reliable brokers is definitely wiser and much safer for investors, be they interested in forex, binary options or any other financial instrument and product. And as the existence of imposters reveals, it is better for traders not to be taking the claims put forward on broker sites as regards their status and regulation for granted, but rather to resort to the local regulator in their jurisdiction in order to obtain valid information as to whether a broker is regulated or not. Trading is a risky enough venture on its own merits, even if it is done through a regulated broker, so there is no reason why traders would chose unregulated brokers to trade with.
George Milios is the founder of onlineforextrading.net, the binary options and forex news portal which is dedicated to providing you with all the information you need to successfully trade.