By: DailyForex.com
In a major escalation, the Israeli watchdog has come down strong on binary options trading. The Israeli Securities Authority (ISA) announced today that it will not approve trading on binary options and that any company that offers them will not be regulated in Israel.
In addition, any company that offers binary options trading in its line-up of investment products will have its license rejected unless it reports to the ISA within 30 days that it has ceased all trading binary options operations except those needed to complete funds withdrawals, account closures and closing positions.
In explaining its drastic move, Chairman of the ISA, Prof. Shmuel Hauser, suggested that binary options were just one of the many investment opportunities offered to traders that camouflage their true risk factors and which can cause undue damage to innocent investors. He compared binary options to gambling games and said that "?binary options activity will hurt not just all clients (including sophisticated investors) but the reputation of the entire market."
Hauser added that going forth, the ISA will work to ensure that the "?jungle" of unregulated investments will not be offered in Israel and that all investment companies will be required to follow the same regulatory laws.
The harsh decision did not come as a total surprise. Several brokers in Israel, such as iTrader, saw the writing on the wall and have already switched over to Forex trading. iTrader is now branded as iTraderFX.