It is already a common practice for provincial Canadian financial authorities and consumer protection watchdogs to issue warnings against trading forex and binary options with foreign brokers. Québec’s Autorité des marchés financiers (“AMF”) even routinely publishes a blacklist of unregistered foreign companies it says are encouraging clients in the province to invest in binary options via online trading platforms.
However, this time, the Alberta watchdog took a step further and turned to a local news show to warn the public against off-shore brokers. According to the warning, the move came after numerous complaints were recently made by people mainly in Edmonton, the capital of Canada’s Alberta province, about losing over $400,000 in binary options trading.
Mark Dickey with the Alberta Securities Commission told the Alberta Morning News what traders should do to prevent getting scammed. Saying, “Check out these websites, does it look legitimate, are the staff members listed or are there stock photos, are they registered, are they overseas, are they trying to get you to set up an account overseas where once your money is off-shore it’s very hard to get back”?
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Dickey also said they’ve identified seven companies which list Canadian contact information but are based in Ukraine, Cyprus and Belize. He added that the securities commission had received fifteen complaints in the last month, but expected that more people had lost money.
Offering investment services or products, whether from an on-line platform or in person, is a regulated activity in Canada under the authority of each of the local provinces. Any company offering trading or investing services in a specific province must be registered with the local authority and get authorized for market derivatives.