Italy’s CONSOB Steps Up Fight Against Binary Options
Italy’s National Commission for Companies and the Stock Exchange (CONSOB) has stepped up its efforts against the binary options industry in the month of December. The watchdog has issued a string of warnings and taken direct action against companies in related industries.
The moves by the regulator come as the fight between the industry and governments across Europe reaches a fever pitch. CONSOB has issued over twelve warnings in December so far, with five coming as recently as this week alone. According to the watchdog, none of these companies is licensed or authorized to provide financial services in the country.
Public sentiment has turned against the binary options industry in 2016, as several countries became more aggressive in attempting to block companies from operating within their borders. Others have tightened their regulatory frameworks to ensure compliance. However, many have wondered at the wisdom of working against the industry, instead of working with it to find a better course of action.
Italy Warns Against Several Brokers
Italy’s financial regulator has been surprisingly active thus far in December, already having issued several warnings to consumers regarding the activities of several binary options brokers. On Tuesday, the company issued statements on brokers www.binarybrokerz.com. www.gmibanque.com which is operated by GMI Bq, www.profitmaximizer.com, and International Partners. Per CONSOB, none of those companies have been authorized to operate in Italy, and none have shown the necessary documentation to prove they are regulated anywhere else in the European Union.
Tuesday’s notices come on the heels of similar declarations made in recent weeks against a string of binary brokers. These companies seem to have taken up residence in Italy after having been bounced from several other major European markets including France, Belgium, Holland, and Austria.
In some cases, the companies are simply operating without a license. However, some of the brokers CONSOB has alerted consumers about have been revealed to be trading scams by regulators across Europe. As Italian officials cannot investigate fully due to a lack of documentation, they have warned consumers to pay closer attention to the fine print. Additionally, CONSOB believes that some offer fraudulent High Yield Investment programs.
Tuesday’s action marks the third such move taken by Italy against the industry, and it echoes similar battles being fought across Europe against the unregulated side of the binary options market.
Harsher Actions to Come?
While Italy seems to have stepped up their actions in the fight against fraudulent and unregulated brokers in the binary options industry, their enforcement efforts still lag behind other major regulator in the region. France has banned the use of direct marketing and advertising for what they deem “high risk” products—which most likely will include binary options—while Belgium has taken an even more drastic step by completely banning the industry within its borders.
Others have proposed similar actions, with Germany debating a measure, and Holland attempting to pass a bill similar to France’s. Even Cyprus, long known as a friendly haven to the binary options industry, has taken steps to tighten its regulatory framework and increase the cost of regulation for companies looking to enter its financial market.
Despite all these actions, some industry insiders have openly questioned if fighting against binary options as a whole is a wise choice, as bans also affect those companies that have made efforts to operate completely above board and comply with all regulations. In their opinion, forcing out regulated and reputable companies creates a vacuum that allows fraudsters and less compliance-oriented firms to engage in predatory practices with little or no fear of reprisal.
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