Binary Options Trader in Court

Binary options is a form of stock market trading where essentially you are betting will go up or down rather than on how much it will move.

That sounds straightforward and maybe a 50:50 chance of winning but in fact 80% of people who try lose their money.

Lee Elbaz, the former chief executive of a major binary options company, goes on trial today in the US charged with defrauding clients of nearly $150m.

Her role in the fraud was first exposed with the help of a whistleblower, in November 2016, and some of the evidence presented by that insider has been used to prepare the case against Ms Elbaz.

The binary options scandal was a high-tech variant of boiler room scams. The fraudsters would cold call potential investors in other countries and persuade them to put money on whether a share or commodity price would go up or down. Initially the investor would see their money growing in an account held by the company and be encouraged to invest more — sometimes hundreds of thousands of pounds. However, when they tried to withdraw the money the binary options company would prevaricate and then stop taking their calls.

Billions of dollars was stolen from consumers all over the world, including the UK and US.

Ms Elbaz, also known as Lena Green, was the chief executive of Yukom, a company that operated binary options trading platforms under trade names such as BigOption and BinaryBook. Her team modelled themselves on Jordan Belfort — the New York stockbroker and scammer who inspired the film The Wolf of Wall Street. Ms Elbaz even took the team to see Belfort when he visited Israel.

The US government alleges that from around May 2014 through to around June 2017, Ms Elbaz directed a scheme to defraud binary options investors by lying to them and misleading them about the nature of binary options trading. Ms Elbaz, an Israeli citizen, was arrested when she flew to New York in September 2017.

Before the exposure of the fraud, binary options companies were allowed to openly advertise in the UK. One, Banc de Binary, sponsored Liverpool and Southampton football clubs. It was later forced to pay up $11 million in fines in the US before being wound up. The Israeli government banned such companies operating from Israel in October 2017 and in 2018 European governments barred the operators from selling to their citizens.

Good riddance.

If you have any experiences with binary options or similar scams – do let me know, by email.

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The Timeshare Resale Scam

Timeshares were a great idea – you buy the rights to the same holiday home for set weeks each year and then you can book travel early on, save money and you know the place so no worries about a poor holiday.

But, that great idea was largely taken over by con artists who used high pressure sales techniques to get people signed up at huge expense and facing risings costs each year that they didn’t expect.

That collapsed and everyone realised it was better to stay away from timeshares.

But what about the people left with timeshares they can’t sell and facing high costs each year for basically no return?

Another generation of con artists sprang up to make life even worse for those people by making false promises – “We will sell you timeshare at no cost to you”.

Often they claim there is no upfront cost to you at all. But once they have you hooked – a variety of upfront charges appear, such as a closing fee which strangely has to be paid in advance of a sale or an assessment report needed for the sale to go through or Brokers fees (they will be allied to the Broker if it exists and hence get that money themselves).

The con artists take whatever they can from you (and many others) then disappear – the phone number goes dead, emails are bounced back, the company name turns out to have been false or they used the name of a legitimate company not connected with the scam.

Guaranteed Sale Scam

Watch out for companies that guarantee a sale as no company can realistically guarantee that. They can certainly guarantee to advertise it until sold, but that’s all. They’ll also likely tell you that you’ll get your money back at closing if anyone else sells it before they do, but that carries the same level of truthfulness as the guarantee i.e. none.

Guaranted Offer

Be cautious of companies who guarantee to bring you an offer on your timeshare. What typically happens in these cases is that the same company who is guaranteeing to bring an offer will themselves make you the offer for a ridiculous price, maybe $100. This keeps their guarantee of an offer “legitimate,” but obviously isn’t what you had in mind. Guaranteed offers are never worthwhile.

The Buyer Waiting Scam

Some companies try to get you to sign-up by claiming they have a buyer waiting to purchase your property. Of course you’ll be required to pay a fee in order for them to forward this buyer to you. Once you pay the fee, the buyer either suddenly gets cold feet, or you never hear another word from the person or their company again.

Timeshare scams continue, so be careful. Don’t be caught out a second time.

If you have any experiences with Timeshare scammers do let me know, by email.

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Official Crime Figures 2018

 

Overall levels of crime showed falls in recent decades, but levels have remained broadly stable in recent years.

In the last year there has been no change in overall levels of crime although this hides variation seen in individual crime types.

Headline figures

  • Theft showed a 13% increase compared with the year ending March 2017. Despite this increase, estimates of theft remain much lower than 20 years ago.
  • a 2% increase in vehicle offences, which includes an 8% increase in the subcategory of “theft or unauthorised taking of a motor vehicle”
  • an 11% increase in robbery
  • a 3% decrease in burglaries, following rises seen in the previous two years
  • a 17% increase in fraud offences
  • a 21% decrease in computer misuse

Figures for year ending March 2019,
Things to note
Computer
misuse
21% decrease (to 966,000 offences) in computer misuse offences estimated by the Crime Survey for England and Wales (CSEW). The CSEW is the best source for measuring the volume of computer misuse offences as it captures offences that go unreported.
Fraud 17% increase in fraud offences estimated by the CSEW (to 3,809,000 offences). The CSEW provides the best indication of the volume of fraud offences experienced by individuals as it captures the more frequent lower-harm cases that are likely to go unreported to the authorities.

There are figures available for all types of crime – above is just for computer misuse and fraud.

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The Website Contact Form Con

Hackers scour websites to pick up email addresses and other contact details which can then be sold to other scammers and spammers. Some legitimate companies also use the same method to get contact details to then sell on, although they know that’s really not allowed (but it’s not a criminal offence).

Some hackers specialise in collecting contact information from websites that use contact forms, as this sells for a higher price. Typically companies are less wary of messages created on their own websites so the scammer or spammer can get more of their messages read.

There is software available to scammers that will automatically fill in contact forms on websites and that is a problem for the website owners, as the messages can look legitimate whereas spam messages arriving on email are much easier to filter out and automatically delete.

Below is a typical incoming message to the radio station using the website contact form to enter the information.

Name: Forest Bovril

Email: forrest.bovril @ gmail.com

Message: Hello

I want to say what a beautiful shop you have made.

I am a regular customer of your website.

I visited your website last month and saw an item I wanna buy.

But I have a question today I wanted to order it but cannot find the product anymore on your website.

It looks like the first picture on this website (then a link)

Mail me if you are going to sell it again.

This is all rubbish – the radio station doesn’t have a shop and doesn’t sell anything online so the entire message is irrelevant and obviously the sender has no idea who they are sending to, so presumably the message has been sent to a huge number of random websites.

All just to get you to click a link which may simply be a website that the sender gets paid for each time someone clicks the link or it may be to download malware or anything else. Never click such links.

If you get a lot of such unwanted irrelevant emails from your contact page then you might consider implementing a Captcha on the form.

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