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SEC charges Israeli binary options trading firm for defrauding U.S. investors $100 million

SEC charges Israeli binary options trading firm for defrauding U.S. investors $100 million
Justinas
Baltrusaitis
1 year ago
2 mins read

The Securities and Exchange Commission has charged Spot Tech House, an Israeli-based binary option trading platform, for defrauding U.S. investors over $100 million through unregistered online sales.

A press release from the U.S. regulator indicates that the company’s two executives, identified as Malhaz Pinhas Patarkazishvili (Pini Peter) and Ran Amiran, were also charged. 

According to SEC, Spot Tech House offered customers a potentially profitable short-term investment opportunity. However, in real sense, the company rigged trading and refused to make payouts to users.

Spot Tech, formerly known as Spot Option, deployed several salespeople who fleeced investors most or all of their money. Notably, the fraudulent salespeople were not straightforward with information on their residence, products they were selling, and identity.

Aggressive marketing to U.S. investors

Spot Option allegedly instructed its white label partners to aggressively advertise binary options trading as a highly profitable investment. However, investors were unaware the white label partners were the counter-parties on all investor trades. This means that when investors lost money, the partners profited. 

The U.S. regulator notes that the scheme happened on a global scale, and it seeks to work with other international partners to bring the culprits to book. 

“Spot Option’s trading platform allegedly supported a worldwide binary options fraud. This action shows that the SEC will work with its foreign regulatory partners to pursue international actors who defraud U.S. investors,” said Jennifer S. Leete, Associate Director in the SEC’s Enforcement Division. 

Spot Option and its shareholders allegedly defrauded U.S. investors from at least April 2012 through August 2017

In the case filed before a federal district court in Nevada, SEC wants the accused parties to return all the ill-gotten gains, prejudgment interest, financial penalties, and permanent injunctions. 

The SEC had previously charged several companies and individuals connected with their role in the sale of binary options through the Spot Option platform. The charged entities include Banc de Binary, Beserglik, and Senderov. 

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Justinas Baltrusaitis
Author

Justin crafts insightful data-driven stories on finance, banking, and digital assets. His reports were cited by many influential outlets globally like Forbes, Financial Times, CNBC, Bloomberg, Business Insider, Nasdaq.com, Investing.com, Reuters, among others.

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