Update: on January 11, the Cyprus Securities and Exchange Commission officially announced that Banc de Binary renounced its authorization to operate as a Cyprus Investment Firm.
One of the leaders in the binary options trading market, Banc de Binary, closes operations. The Forexbrokerz team found out that EU residents are no longer accepted as clients through the broker’s sites.
According to online media Finance Magnates, after the consistently negative press publications that the company faced over the past year, it decided to close down operations and leave the binary options industry. The media cited an insider source - a high level official at Banc de Binary (BNB).
“I don’t see how we can continue operating under such scrutiny and public image,” the BNB employee told Finance Magnates and further explained that all arrangements have already been made to stop accepting new customers. “All client funds are being sent back to their original source… They are literally about to kill a five hundred-million-dollar company, but even worse – the icon of the binary option industry,” he noted.
Established in 2009, Banc de Binary is one of the first regulated binaries brokers. In Europe, it is operated by Banc De Binary (Cyprus) Ltd, a Cyprus Investment Firm (CIF), licensed and regulated by the Cyprus Securities and Exchange Commission (CySEC).
The company also has another unit, BDB Services (Belize) Limited, which was regulated by IFSC, but lost its license due to incompliances with the local regulations in October 2016. This was a severe blow on the broker’s reputation, as Belize a popular offshore destination renowned for its milder regulation that places little focus on supervision of forex and binary options brokers.
Before that, Banc de Binary suffered several harsh fines from the Cypriot watchdog - in January, 2016 the broker was ordered to pay €350,000 in settlement to the CySEC. The regulator had found that the broker failed to comply with its requirements for authorization and has not properly informed clients about its services, the related risks, costs and charges that may occur.
Previous year, the broker also had problems with the US authorities. In February 2016, it was ordered to pay more than $11 million in settlement with the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) for illegally offering off-exchange binary trading to US citizens.
Basically, Banc de Binary has been on almost every financial regulator’s warning list. So, it is no wander its reputation is ruined and it decides to leave the binary options business. In fact, the whole binary options market is under the attack of EU financial watchdogs, that keep coming up with various restrictions on the public marketing or distribution of this risky products.