We recently came across an article posted by the highly respected Binary Options Watchdog about Interactive Option that you need to know about. If you currently have an account with Interactive Option, we strongly suggest that you read the full review written by the Watchdog.
You will notice that this is not our typical format of review, and the reason for this is because of the special nature of this review. You will notice that Interactive Option has been added to our list of scam brokers, and they are likely to stay there unless the claims made by the Watchdog are proven to be wrong.
What the Watchdog site has revealed is that Interactive Option was fined in the order of $330,000 this year by CySEC (Cypress Securities and Exchange Commission) for multiple violations. This is obviously not good for traders that currently hold accounts with Interactive Option, and we suggest that you do your best to contact them in an effort to clear this up, if possible.
The claims made by the Watchdog site includes that their “own partners are reporting that Interactive Option is withholding payments for over 3 months,” and that the owners of Interactive Option have withdrawn large sums of money as part of their exit strategy.
These are very serious statements, and we have found the Binary Options Watchdog to always be just that, a watchdog that protects online Binary Options traders. We also learned earlier this morning that the Watchdog site was targeted in a DDOS (Distributed Denial Of Service) attack. What this means is that an army of thousands of computers are used to flood a site, so that it's servers can no longer operate. While there is of course no proof that this attack was as a result of the negative review, it is most certainly an attempt to bring down the Watchdog site, and we can only wonder at the timing of such an event.
We have found that CySEC has indeed fined not just Interactive Option, but also some of the other firms related to the same group of brands, as reported by FinanceMagnates.com: “Another firm behind several binary options brands like Interactive Option, HelloBrokers and MTXPlus have been slapped with €300,000.”
It is worrying that CySEC imposed such huge fines, which would indicate that not just one or two small regulations were broken. Concerning the fines, the Cyprus Securities and Exchange Commission states: “The fines against the CIFs were imposed following the conclusion of onsite inspections by the Supervising Authority, in relation to weaknesses detected in the compliance of the companies in question with their legal obligations.”
“These weaknesses concern, among other issues, the companies' obligations for the protection of client funds, their risk detection and management procedures, issues of outsourcing of their services, their professional conduct in the provision of services to clients or potential clients, as well as the provision of investment services solely for which they have been licensed,” the statement continues.
Commenting on the matter, the Chairman of CySEC, Demetra Kalogerou, said, “The ultimate goal of onsite checks conducted by the Cyprus Securities and Exchange Commission (CySEC) is to ensure investor protection and the fair functioning of the securities market as a whole, through the improvement in Cyprus Investment Firms' (CIFs) compliance with the necessary laws.”
“CIFs must operate at all times within the legal framework of the securities market and have a responsibility to their investor-clients. Where these duties are breached, as we have seen with these firms, the CySEC will impose fines as provided for by the Law. The CySEC will indicate to CIFs to take corrective measures within a set framework, otherwise additional measures will be taken such as the imposition of new fines, the suspension and/or even the withdrawal of their licenses,” Mrs Kalogerou concluded.
While it is good to know that CySEC is taking action against unscrupulous brokers, we feel sorry for the traders that are caught in the middle. We endeavor to only list the best brokers on our site, and to expose any broker that does not provide a fair and safe trading platform.
Here is a link to the full document that specifies the fines imposed on Pegase Capital Ltd, which operates the following brands: Interactive Option, HelloBrokers and MTX Plus.
Here are some of the highlights of the reasons for the CySEC fine of InteractiveOption, HelloBrokers and MTX Plus.
- “procedures for handling complaints followed by the Company were not adequate”
- “did not take all necessary measures to protect the interests of its clients, safeguarding their rights in respect of the funds belonging to them”
- “it failed to act fairly, honestly and professionally, in accordance with the best interests of its clients”
- “the information provided by the call centers with which it cooperates were not fair, clear and non-misleading”
Those are all pretty serious, and I encourage you to read the full document to understand the implications, especially if you are currently one of their clients.