The US Securities and Exchange Commission (SEC) announced on Tuesday that it has filed charges on two Israel-based individuals with allegedly defrauding US investors out of millions of dollars through binary options. According to the press release, Jonathan \u201cYoni\u201d Maymon and Ronn BenHarav are accused by the SEC of defrauding investors, including retirees and other retail investors, through fraudulent and online offers, which included sales of high-risk securities in the form of binary options offerings.<\/p>\n
The complaint \u2013 filed in a federal court in the Nevada state \u2013 noted that the defendants set up a company based in Israel named \u201cJMRB Media, Ltd.,\u201d which allegedly operates boiler rooms, where in reality, salespersons used bogus tactics and maneuvers to offer and sell binary options under the brand names \u201cPorter Finance\u201d and \u201cDalton Finance.\u201d Also, the financial watchdog claims that JMRB employees didn\u2019t disclose their real names and location, plus their financial expertise, to customers.<\/p>\n
\u201cThe SEC\u2019s complaint further alleges that defendants devised a \u2018win button\u2019 that, when activated, helped to produce winning trades for investors. Salespersons allegedly used this device to create a track record of recommending or placing successful trades for an investor, which was then used to solicit additional investor deposits. The complaint alleges that most investors who made deposits and traded binary options through the brokers lost money, and some individuals lost hundreds of thousands of dollars,\u201d the US SEC stated in the announcement.<\/p>\n
That said, both Maymon and BenHarav were charged with \u201cdirect and indirect violations of the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder, the registrations provisions of Sections 5(a) and 5(c) of the Securities Act, and the broker-dealer registration provisions of Section 15(a) of the Exchange Act.\u201d<\/p>\n