- 1 Like LOCUSTS That Breed Rapidly – So Are The Binary Option Trading Scams!
- 2 How Does The Binary Option Trading Scam Work
- 3 Now we know WHY binary option trading is a breeding ground for scams. Who are the scammers and how do they do it?
- 4 The Flood Of Spam Email Promoting Binary Option Trading Scams.
- 5 You Are Being Scammed By Unrealistic Profit Guarantees!
- 6 You Are Being Scammed By Their Offer To Use THEIR MIRACLE SOFTWARE FOR FREE
- 7 You Are Being Scammed By Fake Testimonials
- 8 You Are Being Scammed By Fake Trading Result Spread Sheets
- 9 You Are Being Scammed By Fake Bank Statements
Like LOCUSTS That Breed Rapidly – So Are The Binary Option Trading Scams!
The scammers find the suitable conditions they need on the internet and became a real pest real quick. And like Locusts that form bands, swarm out and rapidly strip fields and destroy the crops, the scammers and their affiliates swarm the web with their annoying email campaigns and sales videos, and inflict great harm to peoples bank accounts.
This article is not going to be a review about a particular scam. (I wrote six individual reviews which you can find by clicking on the Binary Option Trading Category.)
Instead, I am going to explore and EXPLOIT this fast growing business of defrauding people openly and without remorse. Before I get into it, let me briefly explain how the scam works.
How Does The Binary Option Trading Scam Work
Also known as FOREX Option Trading, trading in derivatives has been around for quite some time. Little known to the general public, it became a hit with Hedge Fund Managers and traders with a lot of money. It is very risky and requires a lot of experience AND knowledge of the financial world market. Is binary option trading legit?
Although it is a lot like gambling, binary option trading is legal and here in the US regulated by the SEC (Securities and Exchange Commission) and under oversight by the CFTC (Commodity Futures Trading Commission)
Besides NADEX, there is not a single broker that is registered in the US. Most brokers are registered with CySec, the Cyprus agency equivilant to our SEC. Yes, there may be some bad apples among the brokers that serve US clients, but the scams are not committed by brokers.
The scam is committed by the AFFILIATE of the brokerages. You see, the brokers pay a commission if an affiliate refers a new trader. There is nothing wrong with that. BUT………….and that’s the big BUT.
To understand how the brokers opened the “door for scammers” to do their dirty and criminal deed, we have to take a look at the size of the commissions they are paying.
Millions of affiliates make money online by referring customers to merchants or service providers and receive a commission for their efforts.
Usually, commissions range from 4% to 30%, in some cases you may get a commission of 50%. Amazon, for example, pays commissions from 4%-6% for all electronic products, 7%-15% for household stuff and clothing articles and up to 25% for magazine subscriptions. Other legitimate businesses may pay up to 50%.
Binary Option brokers on the other hand, pay their affiliates 100% of the MINIMUM DEPOSIT REQUIRED to open a trading account. You will have to deposit at least $250.00 (a handful of brokers ask for just $200.00), AND THIS DEPOSIT IS NON-REFUNDABLE.
$250 commission per referral is a nice chunk of money, don’t you agree? But how can the broker afford to pay YOUR deposit as commission? Well, the explanation is very simple. The brokers make money in two ways.
- From the discrepancy in payout. When a trader wins his bet, the usual payout is 75% of the initial trade volume. 25% goes to the broker as commission.
- When your trade loses, the broker gets 100% of your trade volume.
As I mentioned earlier, BOT is a very risky business. It’s like a coin toss, really. You bet if a commodity will gain or lose value within a certain time frame (from 60 seconds to 15 minutes, or any other period of time during a trading session).
Most inexperienced traders will lose their initial deposit and “re-up” their account in the hope to recoup their losses. Of course, this increases the profits the brokers will make.
Now we know WHY binary option trading is a breeding ground for scams. Who are the scammers and how do they do it?
To be honest, I don’t know for sure WHO really is behind all these scam products. I have watched about fifty (50) of these sales videos and noticed that some are obviously narrated by a paid actor. Others seem to be presented by the creators, yet others don’t even offer a name.
I strongly suspect that the infamous “Syndicate of Internet Gurus” is behind most of them. Too much money can be made and it would be difficult for these scheisters to miss out on an opportunity like this.
It all starts with a massive email campaign. And I mean MASSIVE in capital letters.
The Flood Of Spam Email Promoting Binary Option Trading Scams.
Take a look at the screenshots to the right (click on images to enlarge). From December 15, 2014 – December 18, 12:07, I received 179 emails in my spam folder promoting TEN (10) brand new Binary Option Trading software packages, listed on the left side.
- Secret Money Vault – Matt Walker
- Secret Money Vault – Victor Lambert
- 7 Day Profit Machine – Victor Lambert
- Guaranteed Wealth – Victor Lambert
- Guaranteed Millionaire – Justin Price
- Quattro Bot – Hans Klein
- Truth About Cash – Sophie
- 3 Day Change – Josh Applewhite
- 3 Day Change – Stephen Johny
- 3 Day Change – Mike Mooline
- Quick Cash System – Sarah Maarkel
I noticed right away that Matt Walker and Victor Lambert are promoting different products and BOTH are pushing “Secret Money Vault”. Matt and Victor are well known internet gurus, thanks to some dubious products they created (Victor – Guaranteed Wealth, Matt Walker – Stealth Income Machines: Campaign not active any longer).
UPDATE: Guaranteed Wealth website has been taken down – the scam ran it’s course
Guaranteed Millionaire is an obvious Guaranteed Wealth-spin-off, exact same video, same narrator.
30 Day Change is promoted by three different folks. Is one of them the “creator” or are all three affiliates of the real creator? Who knows.
Yes, the creators of the scams are affiliates of one of the brokers and, at the same time, build their own affiliate force to lure as many as possible new traders to open accounts. Do I have to mention that these affiliates receive the 100% commissions……..and do I have to mention that the “creators” also receive a hefty commission?
You see now how much money is at stake for the affiliates and their affiliates and the reason for the email campaigns. However, that’s only STEP ONE of the scam.
STEP TWO: The emails are enticing enough for many folks to click on the link that leads them to the sales video and the “Heart of the SCAM“. The voices you hear may be different, the faces you see may be different, but they all have the same elements to lure people into opening a trading account with the broker of their choice.
You Are Being Scammed By Unrealistic Profit Guarantees!
- A Millionaire In 100 Day
- $2,000 Profit Every Day Guaranteed
- $137,000 In 60 Days
- 46,572.79 IN LESS THAN A MONTH
You Are Being Scammed By Their Offer To Use THEIR MIRACLE SOFTWARE FOR FREE
The incredible amounts of money you will be making MUST come from somewhere, right? Well, they all will tell you a story, or should I say a “fairy tale“. They all possess a piece of software that can predict the future; the future of how the commodities market will behave. Every single one of these scam artists claims that HIS SOFTWARE is the best and only one to accomplish this feat.
And every single one of these crooks offers you the FREE USE of his miracle software IF YOU OPEN AN ACCOUNT WITH THE BROKER OF THEIR CHOICE.
These are outright lies. First off, software that can predict the future DOES NOT EXIST. Secondly, every broker will provide you, for free, with some sort of software that will show a “MARKET TREND“. These programs are written by humans (which cannot tell the future), based on PAST occurrences and will give a trend signal according to these past occurrences.
You Are Being Scammed By Fake Testimonials
Believe me, I have done my homework on this issue. It takes some time and effort to find the folks that give testimonials about their miracle successes. Having said that, most of them offer their services on fiverr.com, in the section “Testimonials & Reviews by Actors”. They will do any kind of “real looking testimonials” for as less as $5.00.
Banjoman15 is a Top Rated Seller, very busy and used by the scam gang on a regular basis.
You Are Being Scammed By Fake Trading Result Spread Sheets
This screenshot shows you a typical example of how they try to dupe you into believing that their software can predict the fluctuations of the market and is correct over 80% ALL THE TIME.
This fellow wants you to believe that he actually won 12 out of 14 trades. The reality looks different though. I have tried it for my research, opened an account with a broker directly (did not sign up through an affiliate though) and used their “trade signal giving software” BY THE “T“. You can check REAL RESULTS by reading my report, posted just one week ago.
You Are Being Scammed By Fake Bank Statements
Last But Not Least. They provide “PROOF” that you will be making a million dollars within one year by showing “statements” that do resemble real bank statements. Are they real? I don’t know but I believe that they are fake. Even a 10 year old can produce documents like that using “photo shop” or a similar program.
Do they WANT to provide real proof? Obviously not. Several of my requests for notarized bank statements went unanswered. Period.
These scams must be rather lucrative, I surmise. Otherwise, there would be not that many out there. Adding the latest batch, my count is 109 of BOT scams in the year 2014, and I am not sure if I did catch them all.
I hope I was able to get my point across and show you how to recognize these scams and avoid them. If you are considering trying your luck with BOT, go right ahead and give it a try. Just take my advise. Stay away from these scheisters. Do your research and find a reputable broker…….on your own.
Contact them and find out their terms, particular about the “Matching Bonus offers” and their “money withdrawal policies” (enough stuff to write an article about). I suggest you DO NOT opt for the matching bonus. It sounds good, but is really a bad thing.
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