United States Court Fines 5 Offshore Entities & 3 Individuals $338.7 Million & to Return $112.9 Million in Restitution for Binary Options Fraud on United States Residents, 5 Entities with Incorporation in Israel, Mauritius, Marshall Islands, Anguilla, St. Vincent & the Grenadines, Gibraltar and UK
31st January 2025 | Hong Kong
A United States court has fined 5 offshore entities & 3 individuals $338.7 million and to return $112.9 million in restitution for binary options fraud on United States Residents. The 5 entities have incorporation in Israel, Mauritius, Marshall Islands, Anguilla, St. Vincent & the Grenadines, Gibraltar and UK. The 5 offshore entities & 3 individuals are Yukom Communications (Israel), Linkopia Mauritius (Mauritius), Wirestech d/b/a BigOption (Marshall Islands), WSB Investments d/b/a BinaryBook (Anguilla, the United Kingdom, St. Vincent and the Grenadinesm Gibraltar), Zolarex d/b/a BinaryOnline (Marshall Islands), Yossi Herzog, Lee Elbaz & Shalom Peretz. Commodity Futures Trading Commission (29/1/25): “The Commodity Futures Trading Commission today announced the U.S. District Court for Northern District of Illinois issued an order of default judgment against five offshore entities and three individuals, finding them liable for fraud and other violations of the Commodity Exchange Act and CFTC regulations in connection with a global retail binary options fraud that victimized U.S. residents. The defendants executed their unlawful scheme through internet websites using fictitious trade names such as BigOption, BinaryBook, and BinaryOnline. The following foreign entities and Israeli citizens were found liable for, and enjoined from, fraud and other violations: Yukom Communications (Israel), Linkopia Mauritius (Mauritius), Wirestech d/b/a BigOption (Marshall Islands), WSB Investments d/b/a BinaryBook (Anguilla, the United Kingdom, St. Vincent and the Grenadinesm Gibraltar), Zolarex d/b/a BinaryOnline (Marshall Islands), Yossi Herzog, Lee Elbaz & Shalom Peretz. The order finds the defendants engaged in fraud and other violations and orders them to pay, jointly and severally, $112.9 million in restitution and a $338.7 million civil monetary penalty. The order also permanently enjoins them from engaging in conduct that violates the CEA, as charged, and permanently bans them from registering with the CFTC and from trading in any CFTC-regulated markets … … Case Background – The order finds that from March 26, 2014, until the filing of the complaint on Aug. 12, 2019, the defendants made numerous fraudulent misrepresentations to customers on websites and through email and telephone solicitations, telling customers that binary option transactions were profitable, when in fact the substantial majority of their customers lost money, and individual brokers misrepresented their names, financial expertise, and physical location. The order finds the defendants misappropriated customer funds and made additional misrepresentations to thwart customers’ attempts to withdraw their funds, including failing to disclose material information about so-called “bonuses” and “risk-free trades.” The defendants also manipulated their trading platform’s risk settings to limit or prevent customers from being “in the money” with winning trades. Previous Settlement – The court previously entered a consent order against another defendant involved in the fraud, Yakov Cohen, which resolved similar allegations against Cohen and required that he disgorge $7 million in ill-gotten gains received from his participation in the fraudulent binary options scheme. [See CFTC Press Release 8962-24]. Parallel Criminal Actions – On Aug. 7, 2019, Elbaz was convicted by a federal jury of wire fraud and conspiracy to commit wire fraud in violation of criminal statutes based upon substantially the same underlying facts as alleged in the CFTC complaint, she was sentenced to 20 years in prison, and ordered to pay restitution of $28 million in United States v. Elbaz, No. 18-cr-00157 (D. Md.). Cohen pled guilty to a charge of conspiracy to commit wire fraud predicated on the same conduct charged in CFTC’s complaint. He was sentenced to 5.5 years in prison on Aug.15, 2024 and ordered to pay $7 million in restitution on January 22, 2025, in United States v. Yakov Cohen, No. 19 cr 77-1 PX (D. Md.).”
“ United States Court Fines 5 Offshore Entities & 3 Individuals $338.7 Million & to Return $112.9 Million in Restitution for Binary Options Fraud on United States Residents, 5 Entities with Incorporation in Israel, Mauritius, Marshall Islands, Anguilla, St. Vincent & the Grenadines, Gibraltar and UK “
United States Court Fines 5 Offshore Entities & 3 Individuals $338.7 Million & to Return $112.9 Million in Restitution for Binary Options Fraud on United States Residents, 5 Entities with Incorporation in Israel, Mauritius, Marshall Islands, Anguilla, St. Vincent & the Grenadines, Gibraltar and UK
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