The Israel Securities Authority, which oversees the country’s financial market, is conducting a criminal investigation against Israeli citizens suspected of promoting the binary options trading platform “POCKET OPTION.

Binary options trading is banned in Israel. The ISA prohibited marketing and distribution of such products in 2016 following widespread scams, and in 2017 extended the ban to Israelis marketing these services internationally. Despite this, the regulator said Pocket Option has continued to approach Israeli traders, which is illegal.

Unlicensed Platform Suspects Face ISA Probe

The platform does not hold a license to operate in Israel and is based abroad. The ISA said it is not subject to its supervision and offers trading in binary options, a type of derivative that allows traders to speculate on the direction of an asset within a short time frame. Traders can lose their entire investment if the market moves against them.

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According to the ISA, suspects allegedly recruited clients via social media from 2023 to the present, using “misleading information” and “false representations,” which caused financial losses. The investigation covers suspected offenses including soliciting offers to trade on an unlicensed platform, offering binary options, fraud, money laundering Money Laundering Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Read this Term, and providing investment services without a license.

Suspects Detained in Binary Options Probe

Enforcement measures have included searches of suspects’ homes, seizure of evidence, detaining suspects, and imposing restrictive conditions.

The ISA previously warned the public against Pocket Option and urged investors to avoid unlicensed platforms that claim high and immediate returns on social media, which it said can indicate fraud.

US Regulates Binary Options, Event Contracts

Globally, regulators are also taking action on binary options and related products. In the United States, such trading is permitted under strict oversight, and authorities are pursuing operators offering binary options illegally.

Event contracts, which let traders speculate on outcomes like elections, sports, or weather, have been growing. The Commodity Futures Trading Commission has previously targeted political event contracts and is now focusing on sports-related contracts, including probes into Crypto.com and Kalshi, while Robinhood has suspended certain event contracts at the regulator’s request.