Beware! CloseOption is an offshore broker! Your investment may be at risk.
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CloseOption is a binary options broker, based in Georgia, offering bets with 17 forex pairs and several crypto coins like Bitcoin, Bitcoin Cash, Ethereum and Litecoin. The maximum payout for the EURUSD pair is 80%, which is not competitive. Have in mind that maximum payout below 85% is not considered attractive.
However, betting conditions put aside, we have some serious concerns about the regulatory status of the broker, which we will discus in the following paragraph.
CloseOption regulation & safety of funds
CloseOption is owned and operated by the Organic Tech LLC Company – a company based in Tbilisi, Georgia, which says to be registered and regulated by the Central Bank of Georgia. And although that may sound good, the issue here is that the National Bank of Georgia does not regulate forex and CFD brokers specifically, as its sole responsibility is to oversees the monetary stability and the commercial banks in the country.
That said, it turns out CloseOption is not regulated, neither in Georgia nor anywhere else for that matter. On top of that, an interesting detail is that CloseOption does not offer its services in Georgia. Think of that. If they are regulated in Georgia and are legit, why would they not offer their services in the country?
As a rule of thumb, trading with unregulated brokers comes with a unacceptably high risk of loosing your money to scammers. That is because the safety of your funds with unregulated brokers depends solely on the integrity of the people, who run them.
Brokers, licensed by respectable institutions like the Financial Conduct Authority (FCA) in the UK, the Australian Securities and Investments Commission (ASIC) or the Cyprus Securities and Exchange Commission (CySEC) on the other hand are completely safe as they have to abide by strict rules, among which to allow external audits and file regular reports, to keep all clients funds in a segregated, form their own account and to guarantee traders that they will not loose more money than they have deposited. This last rule is called negative balance protection and was adopted throughout Europe last year.
And finally your funds with a broker, regulated in EU, will be covered by an insurance. So for example, if you are trading with a FCA broker you will not have to worry about the first 50 000 GBP in your account, while with a CySEC broker the insured funds are up to 20 000 EUR.
CloseOption deposit/withdrawal methods and fees
The minimum deposit requirement being as low as 5 USD, CloseOption accepts payments with major cards like VISA and MasterCard, as well as a couple of e-wallets – Perfect Money, WebMoney and PayPal and bank wire. And they also say you can pay with some crypto coins – Bitcoin, Dash, Ethereum, Litecoin, Monero, Ripple and Zcash.
However, you should be ware that the broker offers various trading bonuses, all of which come with special withdraw conditions, linked to certain minimum trade volume requirements.
Here we should also note that the practice to offer trading bonuses is banned throughout the European Union altogether, while all binary options bets were also banned in July last year by the European Securities and Markets Authority.
How does the scam work?
It may come as a surprise to you but scammers are pretty well organized and employ lots of resources to get to your money. A scam company functions pretty much as a normal business, except that they will be registered offshore and will employ a call center that will be located probably in Asia or Eastern Europe.
Also scammers pretty often use the services of the so called robo scam websites like Crypto Revolt and Bitcoin Evolution, which are specially designed to hook up gullible investors. There you will probably watch a well cut video, about how you can get instantly rich by joining an innovative trading app or a platform – completely risk free. And all you have to do is fill a simple registration form with your e-mail and phone.
Than you will be instantly transferred to the web page of a unregulated, offshore, scam broker where you will be asked to deposit about 250 USD. And besides, you may be surprised, but your first trades with the scammers will be surprisingly successful and the money in your account will almost double in a day or two. That, however, will not be real. Your account will simply be manipulated so that latter you will be more easily convinced to invest a larger amount.
And surely you will get a phone call as well. It will be your “senior account manager”, who will congratulate you for your trading results, but who will also explain that if you want to make some real cash you will simply have to invest more – like 10 000 USD. And chances are you will invest those money as well, without realizing you have been scammed until the very moment you decide to withdraw some of your funds.
Than scammers will tell you, you can not withdraw anything until you reach a certain minimum trade volume requirement, linked to a trading bonus you have so carelessly accepted. Of course, the pretext might be different, but any case you will not see a single dollar back.
What to do if scammed?
If you are a victim of a scam you have only one option to get your money back and that is to file for a charge back with your credit card provider. The good news here is that in an effort to combat online scam, both MasterCard and VISA extended the period in which you will be able to do that to 540 days.
And if by any chance you have given away the number of your credit card or the password for your online banking service, immediately block your card and change the password.
And finally do not waste any more of your money with the so called recovery agencies. Those people are not to be trusted. They will simply collect an online payment and will leave you even deeper in to the red.