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ASIC targets unlicensed binary option mobile apps

In March 2017, ASIC conducted a review of various mobile app stores focusing on apps associated with binary options trading.

The review highlighted over 330 apps which were offered to Australians by entities and individuals that appeared to be unlicensed. 63% were offered by binary option issuers and facilitated trading, 25% were from various signal providers and the rest were controlled by introducing brokers or were apps designed to influence people to trade binary options.

In addition to the apparent unlicensed activity undertaken by these apps, ASIC was also concerned about the following behaviour:

ASIC contacted Apple and Google about the apps that were the subject of this surveillance. We were encouraged with the speed both entities removed the relevant apps identified by ASIC from their respective app stores. We also note that Apple recently changed its review guidelines to state that apps that facilitate binary options trading will not be permitted in its app store.

ASIC would also like to remind investors that binary option providers are in control of the pricing for their product and, on reviewing some of the comments that appeared with the apps, it seemed that some investors made money in the demo mode but lost money once they moved to a live trading system.

Commission Cathie Armour said, ‘This is a timely reminder for investors to remain vigilant and not fall for flashy advertising or hard selling. Investors also need to make sure any financial service provider, regardless of the way that financial service is being provided, is adequately licensed and authorised to provide those services.

‘In an age where technology can hide who is offering and controlling a product, buyer beware has never been so important. If something appears too good to be true, it probably is.’


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