Binary Options Scams

Contributor Image
Written By
Contributor Image
Written By
Royston Wild
Royston is an experienced investor and writer. His expertise includes stock recommendations through to commodities, forex, and macroeconomic news. Royston's background includes roles as a stocks and commodities reporter, and editor of forex coverage at Shares Magazine.
Contributor Image
Edited By
Contributor Image
Edited By
James Barra
James is an investment writer with a background in financial services. He has worked as a management consultant, where he delivered large-scale operational transformational programmes at some of Europe's biggest banks. James authors, edits and fact-checks content for a series of investing websites.

Binary options scams have plagued the industry in recent years, distorting payouts, refusing to pay winnings and even stealing identities. Regulators like the US CFTC and UK FCA have issued warnings, while our decade-long monitoring has led to a blacklist of over 15 scam binary firms.

In this guide, we explain how common binary options scams work; provide tips on how to avoid them; and discuss what to do if you fall victim to these fraudulent practices.

Quick Introduction

  • The growth of online trading and social media has led to a rise in binary options scams, costing retail investors in the UK alone up to £87K a day.
  • Common scams include manipulating algorithms to ensure losing trades, not paying out profits, selling low-quality signals, and downplaying risks.
  • Dodgy firms often entice binary traders with promises of huge returns and images of luxury goods with websites that appear professional.
  • If you have been scammed, the first port of call is to try and resolve it with the binary broker. If that fails, report it to your local regulator.

Trusted Binary Options Brokers

These are the 3 most trusted binary brokers based on our hands-on tests and in-depth analysis:

Pocket Option
50% Deposit Bonus
30% Deposit Bonus

Binary Options Brokers List

Common Binary Options Scams

These are the most prevalent binary options trading scams we’ve seen over the years: 

Refusal To Payout Winnings

After a binary options trader has opened their account and made a deposit, the broker will often chase them up to deposit more and more to supercharge their profits (or to recover losses).

Only once the trader asks to withdraw their capital do problems become clear. The dodgy platform may refuse to process withdrawal requests; ignore telephone calls and messages; or impose unreasonable conditions that make it impossible for binary traders to retrieve winnings.

Bee Options is a prime example here. We’ve seen multiple complaints from traders who were pressured into depositing more funds and hit with obstacles that made withdrawing funds extremely difficult, including volume requirements.

Misleading Marketing Practices

Some binary options trading scams promise ‘guaranteed’ profits, downplay risks, or use fake testimonials to draw in unsuspecting traders.

In one case in 2016, the SEC ordered EZTD – which operated the EZTrader and Global Option platforms – to pay $1.7 million for failing to properly disclose risks to its customers, and for failing to register as a broker-dealer. 

Fly-By-Night Scams

Some parties don’t intend to execute complicated or long-running hustles. They simply set up shop quickly, tempt binary options traders in with promises of quick and large profits, and then close as rapidly as they appeared when they have amassed considerable sums.

These actors often create a sense of urgency to tempt binary traders to deposit funds, and may even advertise promotions or other incentives to encourage larger payments.

Platform Manipulation

Some schemes involve fraudsters rigging trading software to distort binary options markets and restrict customer payouts.

Methods can include falsifying prices; artificially delaying trade execution; and manipulating trade outcomes to ensure that binary traders lose their stake.

Signal Seller Scams

These swindles target binary traders who lack the expertise and/or confidence to make trading decisions on their own.

A scammer will sell trading signals or information they claim will lead to large profits. In reality, these signals may be based on out-of-date or incorrect data, which can lead to significant trader losses.

The CFTC levied a $100,000 fine against SignalPush in 2023, a binary options signals service that was found to be soliciting investments without suitable authorization.

Theft Of Personal Data

Some binary options scammers aim to harvest huge amounts of personal information for their own use or to sell to other parties for nefarious purposes.

Common targets include credit card details and identification documents like driving licences and passports. 

Binary Options Blacklist

Our experts have been monitoring the binary options industry for more than a decade, identifying platforms that we believe are scams and should be avoided. This is our list as of 2024:

  • Banc de Binary
  • Beeoptions
  • Bull Option
  • EZTrader
  • Global Option
  • OptionRally
  • Option-World
  • Ivory Option
  • LBinary
  • Safe24Option
  • TraderXP
  • Vault Options
  • CryptoTradefx360
FINRA’s BrokerCheck shows firms with outstanding legal actions.

How To Avoid Binary Options Scams

There are 5 steps you can take to protect yourself when trading binary options:

  • Verify whether the binary options broker is regulated. If you use an unregulated broker, your money may not be protected if something goes awry. Also, the broker may be able to act unethically without breaking the law. Unregulated binary options brokers are not always scams, but it is certainly safer to use a regulated platform.
  • Be vigilant to unscrupulous trading practices. Unsolicited e-mails and cold calls – along with requests for immediate deposits – are common tactics employed by binary fraudsters. And if they use lines like “our prices may not reflect those of the actual market”, they are likely a scam.
  • Study the broker’s website. A badly designed web page, poor (or non-existent) information on trading conditions, and a failure to discuss risks while bigging up returns can be surefire signs of a binary broker you should avoid. Also check the small print of a website to check that there are no hidden fees or unreasonable withdrawal restrictions, which often apply to bonuses.
  • Check reviews. Reading the experience of other binary options traders can be a great way to identify which companies to use. Trusted review sites and investor forums are useful tools. In particular, pay attention to reviews that allege that the binary options broker prevented clients from withdrawing cash or moved trading goalposts arbitrarily.
  • Shy away from dubious marketing. Advertising materials that fail to mention risks, and promise payouts that are “too good to be true”, should be treated as highly suspicious. Trading in binary options is a high-risk, high-reward activity: if a broker promises low chances of failure, they may be a scam.

What Should I Do If I’ve Been Scammed?

If you feel you’ve been the victim of a binary options scam, start by contacting the broker to try and resolve the issue directly.

If you have no means of contacting the party in question – or they fail to respond to your concerns – the next course of action is to contact the regulator in your territory.

This could be the SEC in the US, for example, or the FCA in the UK.

FCA guidance on steps to take after being scammed trading binaries
FCA – Guidance If You’ve Been Scammed
Unfortunately, even this does not mean you will definitely get your money back. As most bad binary options actors are unregulated, the chances of victims getting their funds returned can be slim to none.
author image
Royston Wild

Bottom Line

The semi-regulated nature of binary options trading has created a huge grey area for fraudsters to exploit. Dodgy brokers tend to promote themselves online, through social media, or via bogus profiles on messaging apps.

Traders should always carefully research the broker they wish to do business with. But the recent surge in bad actors in the binary options space means investors here need to be particularly vigilant. And especially as getting one’s money back from one of these fraudsters is a near-impossible task.

To find a reputable provider, see our list of trusted binary options platforms.


Are Offshore Binary Options Brokers Scams?

Not all offshore brokers will be scams. However, they may not be regulated as heavily as other binary options brokers, making them a riskier choice in the event of issues, such as withdrawal delays.

I Received Unsolicited Contact From A Binary Options Broker, Is It A Scam?

Reputable binary options brokers will not contact you randomly by phone or email and any firm that does so may well be a scam.

My Binary Options Broker Might Be A Scam, What Should I Do?

If you believe you are unable to withdraw your money, do not try and remove any further funds – instead, contact the relevant authorities in your jurisdiction. Also report the firm online to blacklisting/trading standards sites to help other binary options traders avoid the scam.

How Can I Tell If A Binary Options Broker Is A Scam?

Red flags we’ve observed on scam binary options platforms include: claims profits are guaranteed, not responding to messages, websites that lack an SSL certificate, fake ratings and prizes advertised, no address with their physical headquarters or it’s hard to figure out where they are based.

Article Sources

The writing and editorial team at use credible sources to support their work. These include government agencies, white papers, research institutes, and engagement with industry professionals. Content is written free from bias and is fact-checked where appropriate. Learn more about why you can trust