Binary options remain to be widely unregulated all around the world, although most financial regulators attempt to do something about it. Israel is now starting to take notice, and the shutdown of AnyOption’s call centre may be the first of many moves we see by the country’s financial regulator.
The war against binary options
While binary options are not illegal, they have actually been a tradable financial instrument for over 40 years. Nevertheless, the industry in general remains widely unregulated, leaving the brokers to basically do as they wish.
In an attempt to tame the industry, the CFTC in the US has openly advised traders from engaging in the industry. Other financial regulators like the FSMA in Belgium are preventing companies from setting up shop in their backyards. Israel has not doing either of these things, and the binary options industry in the country has become a giant.
A report by Finance Magnates reports that the binary options industry makes up 63% of Israel’s financial industry. Given the 25% corporate tax in the country, the binary options industry contributed $1.25 billion. This would translate to revenues of $5 billion or more; probably more because the regulators don’t know what’s going on.
Israel had become a safe haven for binary options brokers, but now things are changing. The parliament recently passed a bill that reviewed Israel’s securities law and granted the Israel Securities Authority (ISA) more authority. The problem isn’t that the industry is just large, but that there had been so many illegal activities done but ISA had no authority. So much so that the binary options brokers are now being called the ‘Wolves of Tel Aviv’.
What led to the shutdown of AnyOption’s call centre?
Among the new rules set after the review of the securities law is the ban on marketing to foreigners. AnyOption had set up a call centre in Israel to make use of the robust population of trained marketers there. The binary options market has been providing employment to thousands of people in Israel since 2008, and it’s fair to say they are well trained. Legislation by ISA would cut down most of what AnyOption’s call centre did thereby making the branch irrelevant.
Furthermore, a change of legislation by CySEC, where AnyOption is officially registered, required that binary options brokers provide certain services internally and not to outsource. We can assume that CySEC is trying to more closely monitor brokers’ activities in this move. This also meant there was very little use for the call centre, hence the shutdown of AnyOption call centre. AnyOption is still operating in Israel, but their activities have been greatly limited.
It’s important to clarify that fraud had nothing to do with the shutdown of AnyOption’s call centre. AnyOption remains to be a highly reputable binary options broker which is registered and regulated by CySEC. Client’s reviews are also mostly positive, so you should not take this news as an indication of fraud by the company.