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How to Avoid Being Duped by a Binary Options Trading Scam?

Binary Options Trading Scam

Binary options are a very new concept. It only became popular in 2008 when it was introduced to the public by the American Stock Exchange (AMEX) and the CBOE. But here’s the catch: while a lot of people perceive binary options as another lucrative investment opportunity, scammers are often lurking behind looking for their new prey. In 2017, people in the UK lost an average of £14,600 ($20,000) to binary options scams, according to the UK’s Financial Conduct Authority (FCA).

What is Binary Options Trading?

Binary options is an options contract whose return is entirely based on the investor’s prediction of the underlying asset’s value. Binary options have only two outcomes: receiving a fixed amount for the correct guess or losing all of the invested amount because of the wrong guess.


Before getting started with binary options trading, one must be aware of the regulations surrounding this market. They should update themselves with the basic terminologies and the potential risks associated. Here are some of the key aspects you must know about binary options trading:


  • First, the investor has to predict the price movement of an underlying asset within a specified time frame.
  • Then they place trades based on their prediction.
  • If their prediction is correct, these options will pay a fixed amount, but note that if the guess is wrong, the investor will end up losing the money.
  • While it does sound like a relatively low-risk strategy, the investor must be aware of the risk and reward system of binary options.
  • Talking about the regulations, binary options are regulated and legal in most jurisdictions.
  • However, the binary options market is an easy target for scams. Thus, the investor must research well and only deal with a reputable broker.
  • They should always verify the regulatory license of the broker they’re dealing with.

A Deep Dive Into Binary Options Trading Scams

Looking at binary options, the most common question that arises in the mind of a layman is: are binary options scams? 

Well, we have a very clear answer to that—NO. Trading binary options isn’t a scam in itself. But the intermediary you are dealing with might be a scammer! What does that mean?

When you’re ready to invest in binary options, be cautious of brokers who promise hefty profits. They likely just want your money.

Binary options scams are a huge concern in the financial industry. Most of the trading platforms are fraudulent and are only behind your hard-earned money. These platforms constantly breach regulations and use tricks to change the prices and payouts of binary options.

Therefore, investors must equip themselves with the knowledge of how scammers operate. 

Let’s take a look at the tell-tale signs of binary options scams below:

  1. False promises of high and guaranteed returns in a short amount of time.
  2. Misleading advertising and promotions.
  3. High-pressure sales tactics to convince investors to invest in their products.
  4. Manipulating trading software to ensure that investors lose their money.
  5. Refusing to allow investors to withdraw their funds or charging high fees for withdrawals.
  6. Stealing investors’ personal information or using their credit cards without permission.
  7. You should be concerned if the broker doesn’t provide clear information about their history, asset selection, and trading options.

Now let’s see how you can avoid falling victim to binary scams below:


How to Avoid Being Duped by a Binary Options Trading Scam?

To avoid falling victim to a binary options scam, consider the following steps: 


Step 1: Check Broker’s Legal Status

To make sure that the platform or broker is legitimate, check if they are regulated and registered with the authorities. Certain regulatory bodies keep lists of unregulated or scam binary options brokers. So, it’s important to look at these lists and confirm the broker’s status.


Step 2: Stay Updated

Gain knowledge about the binary options market, trading strategies, and common tactics used by scammers. Educate yourself to understand how these scams work.


Step 3: Do Your Research

Do thorough research before using any platform or broker. Take the time to read online reviews. Make sure the broker has all the necessary licenses and is regulated by a strict financial authority.


Step 4: Beware of The Red Flags

Be cautious of warning signs, such as unrealistic profit claims, high-pressure sales tactics, and refusal to let you withdraw money. If a broker keeps pushing you to invest more or make quick decisions, take it as a red flag.


Step 5: Understand Risk Management

Before engaging in any transaction, make sure you understand the fees, commissions, taxes, and other costs involved. Only invest an amount that you can afford to lose and be cautious of promises that guarantee profits.


What we discussed above were the steps for prevention. But what if there’s nothing left to prevent? What if you’ve already fallen to the shady tactics of fraudsters? Here’s when our recovery experts like Costner Recovery come into the picture.


Follow this step-by-step guide to help you sail through a binary options scam and boost your chances of binary options scams recovery:


  • Contact the broker: The first step is to contact the broker and ask for a refund. But be aware, that some scammers may not respond or refuse to give your money back.
  • Ask for a chargeback: If you used a credit card to pay for the scheme, you can ask your credit card company for a chargeback. This is a good way to get your money back because credit card companies usually support customers in fraud cases. 
  • Get help from a recovery expert: If the previous steps don’t work, you can hire a binary options scams recovery expert like Costner Recovery. These experts are experienced in dealing with scams and can help you recover your money. 
  • Act quickly: It’s important to act fast if you’ve been scammed. Waiting longer can make it more difficult to get your money back.
Closing Thoughts

Undoubtedly, Binary options can be a great investment opportunity provided you’re knowledgeable enough to enter the market.

This blog has provided everything you must know about binary options and how you can avoid falling victim to binary options trading scams.

Remember, this blog is just the start. Keep your research spectacles on and proceed with caution before committing your hard-earned money to someone.

Did you get scammed by a fake broker? Worry not. Make your way to Costner recovery! With over 15+ years of experience and 120+ projects, we have helped multiple victims find their way to recovery and you can be next!

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