The ASC (Alberta Securities Commission), the leading Canadian financial watchdog, has recently released a list of the Top 5 risks for investors and traders in the new year.
The list consists of several perils which have been an ongoing concern amongst other regulators and national watchdogs such as the OSC and BCSC, who have been naming and shaming specific binary options and forex brokers they discovered to be taking advantage of Canadian citizens.
Here is the ASC’s Top 5 list for the coming year:
1. Unregistered sources
It’s important to do your research before investing money with a broker. Any company selling securities or investment advice in Canada must be registered and it’s never been easier to check up on them through the local website www.aretheyregistered.ca.
Moreover, Fairbinaryoptions recently took the decision to stop promoting unregulated brokers on our website, so as to deter traders from investing money with unregulated brokers who do not possess a valid license. From our previous experiences, we have come to realise that most unregulated brokers tend to display some form of unethical behaviour since they are not supervised by any higher authority.
2. Binary Options Scams
This one also made ASC’s list last year and unfortunately, as the industry continues to grow, scams and fraudulent activity are also on the rise. Some red flags are often recognisable, however, so again, fact-checking and research is an important factor.
3. Offshore Investments
If a company requires you to transfer funds to their offices located overseas, this could be one of the telltale signs mentioned above. Even national and regional regulators cannot do much to help if something goes wrong when customers invest funds to offshore locations, often resulting in the money ‘disappearing’ with no way to trace it.
4. Sneaky Marketing Tactics
Most fraudsters are clever enough to understand the power of social media as a marketing tool to promote their goods and services. They are not above using dishonest gimmicks in an attempt to trick and attract unsuspecting customers, by, for example, misleadingly using pictures of celebrities to endorse their brand.
5. Falling for the ‘Next Big Thing’
It may seem like an enticing prospect to invest money into a thriving industry but traders must not let their emotions get the better of them. It’s wise to exercise prudence and be alert to signs of misleading or lack of information, especially when it comes to new companies.
We advise our readers to heed this information when choosing a binary options broker and to only opt for regulated brands whenever possible.