Web17/7/ · On March 23, The Times of Israel published “ The wolves of Tel Aviv: Israel’s vast, amoral binary options scam exposed ” — a shattering investigation of widespread Web24/9/ · On March 23, The Times of Israel published “The wolves of Tel Aviv: Israel’s vast, amoral binary options scam exposed” — a shattering investigation of widespread Web20/10/ · The law enforcement of Israel and Germany have together busted a binary options fraud racket on Wednesday, arresting 15 suspects in Israel. The police released Web10/1/ · i24 News sit down with Austin Smith of Wealth Recovery International to discuss the recent binary options ban in Israel and the potential fallout Web15/10/ · On Sunday, April 3, a spokeswoman for the Israel Securities Authority said that it was moving to prohibit Israeli online trading companies from offering binary ... read more
In fact, however, the platforms are allegedly rigged by the fraudulent firms, so that the numbers flashing across the screen can be manipulated to ensure that the customer cannot profit. The fraudsters can and do rig the numbers so that customers think they are making money on their trades for a while, and are thus inveigled into depositing still more; the losses come when the victim is deemed to have been milked dry.
Again, therefore, this is not investing. With these fraudulent firms and their duplicitous sales teams, nobody is purchasing a legitimate, conventional option to buy or sell a commodity. The clients, rather, are being played for fools — their funds manipulated as they are expertly squeezed and then cynically discarded. The big-fish companies that supply the trading platforms to smaller binary options firms are therefore central to the fraud.
In one case, we have been told, one such supplier has recently been given a government grant to expand its operations to a major world power with which Israel is working to boost trade — the government using our taxpayer shekels, unwittingly, to finance the potential further global expansion of Israeli binary options fraud.
I mentioned above that some of the fraudsters have become increasingly reckless as the years have passed and nobody has come to put them in jail. That recklessness now sees some firms not even bothering to present the appearance of normal trading, but rather, when customers have been fully fleeced, informing them that their money has been lost on unsuccessful trades made on their behalf.
More reckless still, when customers become tenacious in demanding their money back, some firms simply stop taking their calls.
Other ruses employed to separate victims from their money are described here. The false names and untraceable phone numbers mean that the victims have a hard time tracking down the crooks. The Times of Israel has been told of powerful lobbying efforts by well-connected individuals to ensure that the industry is allowed to continue to flourish.
The industry is facilitated by a range of side industries. There are the SEO search engine optimization experts, who ensure that the thieving firms appear high on Google search result pages — readily available to potential customers.
The SEO experts also ensure that websites purporting to help would-be investors with information on binary options — websites that are themselves often set up and maintained by the self-same corrupt firms — pop up high on Google, too. There are the production teams, writers and actors making video ads for the industry , deceptively extolling the virtues of this expert and that revolutionary trading platform. Abysmally, reputable Israeli organizations have helped the corrupt binary options industry to attract staffers — in some cases unwittingly.
But nobody, at this stage, can credibly claim ignorance. Since we began highlighting the fraud, several official organizations and private manpower firms , to their credit, have begun barring binary options firms from using their recruitment services or advertising on their sites. Some, but not all. We have been told about some credit card firms that are scrupulous in protecting their customers from the fraudsters, and others that are less so.
The same goes for banks. The fraudulent firms accept initial deposits via credit card, but much prefer to fleece their marks of larger sums via bank transfer. A number of banks, some of their names known to us, play a leading role in this process. When requests for chargebacks mount, the credit card firms get suspicious, and that spells trouble for the fraudsters, who will therefore go to extreme lengths to avoid such repayments. Thousands, maybe tens of thousands, of young Israelis get up and go to work each day to commit robbery.
Unscrupulous Israeli firms we have come across use SEO and other expertise to cheat and steal in other online areas. With the possible exception of online gambling, another cash cow with plenty of Israeli involvement whose integrity and regulation we have yet to investigate, however, nothing remotely compares to the scale and cynicism of binary options fraud. When it comes to the impact on the victims, the personal consequences of this mammoth fraud can only be imagined.
We were told by one ex-salesman that he quit the industry, finally, after years of silencing his conscience, when he heard a colleague call a client whose wife answered the phone and said her husband was not available; he had just committed suicide because of their binary options losses. Other ex-traders told us they knew of other suicides. We have spoken to victims who told us they were considering suicide, and to victims who told us they have had to sell their homes and cannot see how they will ever recover financially.
Again, were these victims just foolish gamblers, addicted to self-destructive financial decisions, one would have less sympathy. But these are trusting people who had been sweet-talked into parting with their savings by men and women using false names, making false promises, claiming to be enabling them to make wise investments, and then stealing their money.
The Israel Securities Authority, belatedly protecting Israelis from their fellow citizen-crooks, claims to lack the authority to prevent Israeli firms stealing from people abroad — an interpretation of its mandate that some experts contend is incorrect.
The Israel Police, for its part, has told overseas victims that it cannot handle complaints by email or phone, and that they need to fly to Israel and register a complaint at an Israeli police station.
An effort by former Knesset member Einat Wilf to have the industry shut down went nowhere. The Times of Israel has also been told horror stories about corruption in high places ostensibly central to the failure of the authorities to intervene, but we have no hard evidence of this.
While the Israeli authorities have failed to take action, however, class action suits are now being prepared in London , raids have been taking place involving Israeli suspects in Romania , French investigators have visited Israel to probe complaints on behalf of French nationals, and Canadian regulators are digging into the corrupt Israeli firms.
The US , Canada, Australia and other countries issue watchlists and warning notices that highlight Israeli firms. Overseas media is taking increasing note. The implications for Israel are grave. Israel has attracted an enviable reputation as a stable environment for business and finance.
The dizzying scale of the binary options fraud, and the appalling failure of the Israeli authorities to tackle it, constitute a tangible threat to that hard-won reputation, and thus to ongoing international investment and business development in Israel. If that were not serious enough, however, there is the matter of morals and ethics — the bitter reality that Israel is a world leader in a cynical industry of theft.
Thousands, maybe tens of thousands, of largely young Israelis get up and go to work each day to commit robbery. Some of them brag about it. Some of them love ringing that bell and basking in the applause of their fellow crooks when they extract a big new deposit from some dupe on the phone. Some of them brag that they earn more than their parents. They love the foreign trips the firms sometimes provide. They love those salaries. Some of them blame the clients for allowing themselves to be fooled.
This claim was actually made on camera in the TV report last Tuesday night. Some of them are being eaten up inside with the knowledge of the crime they are perpetrating, but carry on doing so regardless. Last week, after my colleague Simona Weinglass and I had met with an insider who recently, finally, walked away from her job duping marks into giving her their money, we happened to pass a building where a company that writes marketing materials for a binary options firm has its offices.
A young man was emerging, about to head into the traffic on his electric bicycle. ru, a prominent Russian financial news site, and who has appeared at finance confabs with senior Russian officials.
In a phone interview with Dagens Nyheter, Keselman denied that his company, the Milton Group, defrauded clients. He claimed, rather, that clients lose money through their own mistakes. If clients lose money why should we send back money? David Todua, a year-old Georgia-born Israeli, was identified by the Dagens Nyheter whistleblower as the silent owner of Milton Group. Todua does own Naspay, a payments company that the Milton Group used to process payments, according to documents smuggled out of the call center by the whistleblower.
Israeli court documents show that in , Todua posted bail for Osama Hanun, at the time a member of the Izzat Hamed criminal gang in Jaffa. Todua told the OCCRP that he does not recall posting bail for him. These two companies are Project Partners, a real-estate and construction firm, and Elitekomfortbud, a construction and civil engineering firm.
Elitekomfortbud is run by Petre Tsiskarishvili, a former Georgia minister of agriculture. Kezerashvili acknowledged to the OCCRP that he is a business partner of David Todua but claimed no knowledge of the Milton Group call center or its activities.
The OCCRP found no evidence that Kezerashvili was connected to the call center. I am indeed a shareholder in certain real estate and construction businesses in Ukraine with Mr. Janashvili worked as an intern at Lbinary, an Israeli binary options company sued by the US Securities and Exchange Commission for allegedly defrauding thousands of investors. The whistleblower told reporters that investors in most countries were fair game, with a few exceptions.
Citizens of the United States, France, Belgium, Israel and Ukraine were off limits. The Milton Group whistleblower told reporters that he originally took the job because it seemed like a normal workplace in a normal office building. At first it looked okay. A lot of young faces. It was international. I saw people speaking English, Spanish, Italian and Arabic and of course Russian and Ukrainian. They taught us how to sell. Israeli police have shown little interest or ability to investigate this underground economy, whose size, economic and social impact remain unknown.
The fact that the individuals linked to the Kyiv call center are politically well-connected suggests one reason lax law enforcement by Israel can be so dangerous. But law enforcement can become so lax, warns Hirschfeld, that it ultimately leads to the transformation of democratic regimes into something closer to gangster states or kleptocracies.
In these cases, national political boundaries will remain unchanged, and vestiges of democratic institutions such as periodic elections may persist. But a truly democratic polity is incompatible with a racketeer economy, and eventually the institutions of democracy will fail if the economy is overtaken by racketeering. Very little data exists on the size of the fraud economy in Israel or the number of Israelis operating scam call centers from places like Kyiv.
There is reason to believe the phenomenon extends far beyond the Milton Group. On a recent flight from Kyiv to Tel Aviv, a man in his 30s was assigned a seat next to two reporters from The Times of Israel.
I joined The Times of Israel after many years covering US and Israeli politics for Hebrew news outlets. I believe responsible coverage of Israeli politicians means presenting a degree view of their words and deeds — not only conveying what occurs, but also what that means in the broader context of Israeli society and the region.
I believe Israel is stronger and more democratic when professional journalists do that tough job well. Your support for our work by joining The Times of Israel Community helps ensure we can continue to do so.
So now we have a request. But as the journalism we do is costly, we invite readers for whom The Times of Israel has become important to help support our work by joining The Times of Israel Community.
Reporting by Simona Weinglass established that much of this industry, which employs thousands of people — many of them young, many of them immigrants — is nothing more than theft. Far from investing in any legitimate, conventional options-buying process, the hapless clients of the fraudulent companies are actually gambling in a crooked casino. Presenting themselves to naive clients as responsible firms offering an opportunity to make money by trading in options on commodities, the fraudulent companies in this industry turn over hundreds of millions of dollars, perhaps even billions.
They prey on customers attracted by tantalizing get-rich-quick ads online, in emails and through phone calls. Via a variety of ruses, customers are inveigled into placing their money on a bet as to whether a commodity will rise or fall in value. In theory, they make money if their bet proves accurate and lose their stake if it is not.
Unlike respectable brokers who charge a commission and have every interest in their clients making money, these fraudulent firms depend on their clients losing. A minority of the victims of these fraudulent companies are native Israelis. The majority of the victims live abroad. Israeli regulators have been unconscionably lax in tackling the fraud, which has been ongoing for several years. The Israel Securities Authority has indicated in recent days that it may finally outlaw binary options dealing, though not the companies themselves.
As our article highlighted, however, any such ban will only constrain firms that defraud customers in Israel. Israel-based firms will be free to continue fleecing clients overseas. Already, many of the companies involved are adapting their operations accordingly. Rather than a force for good, in this case, Israeli innovation is being used to enable theft. So skilled is the industry in manipulating Google, indeed, that anyone trying to research the industry is directed to supposedly informative websites that are often run by corrupt firms and their affiliates.
The scale of the binary options fraud, however, dwarfs such scams, both in its cynicism and in the colossal sums of money involved. In the few short days since our article was published, The Times of Israel has been contacted by numerous people whose lives have been blighted by this ongoing fraud.
We will be speaking to them, and following up their stories. We invite others who have worked in the industry, or who have been defrauded by it, to contact us. You can do so by email to: office timesofisrael. I joined The Times of Israel after many years covering US and Israeli politics for Hebrew news outlets.
I believe responsible coverage of Israeli politicians means presenting a degree view of their words and deeds — not only conveying what occurs, but also what that means in the broader context of Israeli society and the region. I believe Israel is stronger and more democratic when professional journalists do that tough job well. Your support for our work by joining The Times of Israel Community helps ensure we can continue to do so.
So now we have a request. But as the journalism we do is costly, we invite readers for whom The Times of Israel has become important to help support our work by joining The Times of Israel Community. Illustrative view of high-tech office buildings in Herzliya Pituach, Israel, December 12, Get The Times of Israel's Daily Edition by email and never miss our top stories. Newsletter email address Get it By signing up, you agree to the terms. Thank you, Tal Schneider, Political Correspondent.
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Web20/10/ · The law enforcement of Israel and Germany have together busted a binary options fraud racket on Wednesday, arresting 15 suspects in Israel. The police released Web15/10/ · On Sunday, April 3, a spokeswoman for the Israel Securities Authority said that it was moving to prohibit Israeli online trading companies from offering binary Web24/9/ · On March 23, The Times of Israel published “The wolves of Tel Aviv: Israel’s vast, amoral binary options scam exposed” — a shattering investigation of widespread Web17/7/ · On March 23, The Times of Israel published “ The wolves of Tel Aviv: Israel’s vast, amoral binary options scam exposed ” — a shattering investigation of widespread Web10/1/ · i24 News sit down with Austin Smith of Wealth Recovery International to discuss the recent binary options ban in Israel and the potential fallout ... read more
The scale of the binary options fraud, however, dwarfs such scams, both in its cynicism and in the colossal sums of money involved. Click the link in that email to complete registration so you can comment. I believe Israel is stronger and more democratic when professional journalists do that tough job well. How are you doing today? The fraudulent firms accept initial deposits via credit card, but much prefer to fleece their marks of larger sums via bank transfer. Get The Times of Israel's Daily Edition by email and never miss our top stories. A year and a half later, only 6 of the 21 companies became regulated by the ISA.But they want you. So now we have a request. Binary options scams israel are rules as to how someone can access money in a claim. He claimed, rather, that clients lose money through their own mistakes. I told him he should be ashamed of himself. At some binary options firms, the online platform is manipulated to provide false results that ensure the customer loses. Register to continue.