Not There Yet

UK-Based Binary Options Brokers Still Need a Gambling License

The gambling commission reacts after it was revealed the UK government plans to switch the authority in charge of binary

The UK’s Gambling Commission (UKGC) has issued a warning, advising the British public to beware of scams masquerading as binary options trading. The most probable reason for the timing of the warning is to inform binary options brokers that they still require the approval of the UKGC to operate in the country.

Binary options betting operators in the UK are currently regulated by the Gambling Commission. This is set to change in the future, as regulation of such products transfers to the Financial Conduct Authority (FCA). For the time being, the UKGC clarifies, any binary options operator that is based or has key equipment in Great Britain, must hold an operating license from the Gambling Commission.

There are a number of licensed operators in this category. Those operators are required to emphasize on their websites, that they are licensed by the Commission, whether or not they hold other licenses from other regulators. Binary options operators that are based overseas do not need a Gambling Commission license to market to UK customers. Reputable operators will, however, be licensed in the jurisdiction in which they are based.

Anyone considering taking part in binary options betting is advised by the UKGC as follows: Check you are dealing with a licensed operator – binary options operators based in Great Britain currently need to be licensed by the Gambling Commission and to display this on their websites. Operators in reputable jurisdictions will have their own domestic regulators, most of whom have similar online registers.

Additionally, if you have any doubts concerning an operator’s license, then do not sign up with them. An unlicensed operator is likely to be acting illegally. They will not abide by any code of conduct and have no incentive to deal fairly with you. Unlicensed operators are likely to use false names, addresses and contact numbers – they can disappear with your money and without a trace, making recovery impossible.

The UKGC lists a number of warning signs to help traders recognize a scam:

If something sounds too good to be true, it probably is- There is no such thing as a risk-free transaction involving binary options, any more than there is a risk-free bet. Likewise, you should be cautious before placing money with an operator that promises unrealistic returns.

Beware of cold-calling- If you have not contacted an operator beforehand, it would be wise not to engage with them and you should not give them any personal information.

Beware of false claims about operator regulation- Binary options operators based in Great Britain currently need to be licensed by the Gambling Commission and to display this on their websites

Got a news tip? Let Us Know