SEC and CFTC charge Banc De Binary with lawsuit and injunction
It looks like Banc De Binary have finally stepped on the wrong toes. Over the weekend the SEC filed an injunction against Banc De Binary for soliciting binary options trading from US customers without a license to do so. The SEC acknowledges that the CFTC is helping them with this case. In parallel the CFTC also announced filing of civil charges against Banc De Binary for the same thing.
The SEC is seeking an immediate injunction and financial penalties from Banc De Binary, you can read the full release here. While the CFTC is suing BDB in federal civil court also seeking damages, restitution and immediate injunction – read the CFTC announcement here.
Is this the end of Banc De Binary?
Only time will tell if Banc De Binary can survive this much Federal attention but the lesson is clear. Aggressively targeting US customers, lying about regulation and then using the CFTC and SEC names in press releases without permission or accuracy can only lead to trouble. It seems that the SEC has collected a lot of very specific information already from traders about their experience from traders. Even BDB has officially stopped accepting US traders, it looks like it may be too little too late.
What does this mean for Binary Options Regulation?
It’s very early to judge the fallout from this but a lot depends on other brokers’ reactions and what the SEC and CFTC decide to do after they’ve finished with Banc De Binary. There is a good analysis of the implications and news here if you want to follow it. We will all have to wait and see but it’s obvious that BDB’s action have not helped the industry at large.
A joint SEC and CFTC consumer alert was also released this weekend for US traders to be aware of binary options scams and to pay attention to broker regulations when trading.