The binary options scam is one of the biggest scams in contemporary times, yet if the scam is so pervasive you might be questioning how this industry has managed to con so many people? And how do they keep finding new people to scam? The answer is more in-depth than you might imagine.
Have You Heard About Leads?
In the binary options industry, potential clients are referred to as leads. These are the phone numbers, and sometimes email addresses, that brokers or account managers covet. The further down the rabbit hole of the binary options scam you go, the more you realize leads are a big part of the industry, and many tangent industries profit from lead selling.
Many fraudulent binary companies have their headquarters in Israel and are owned by Israeli nationals. The reason for this is very specific. Unlike other financial trading sectors, binary options’ existence in Israel doesn’t stem from interbank or technology sectors. These fraudulent companies were not founded by certified stock market brokers with financial expertise. This industry originates from online casinos and gambling.
It All Goes Back to Casinos and Gambling
The abundance of binary options brokers in Israel can be directly traced to Israel’s gambling industry, which became oversaturated. The market was filled with revenue generating businesses like online casinos, sports betting and the rebate market. Soon it dawned on these entrepreneurial company owners that they could use similar business models with the existing binary options financial instrument. The relatively straightforward product would be easy to market.
It also helped that the casino owners had made a fortune from the gambling scene. This fact allowed them to afford the outlay for financial technology such as the purchase of closed system MetaTrader 4 licenses. Israel had the added benefit of a significant population of immigrants from all over the world, making it easy for these companies to fill up sales teams with native speakers. Using their old lists of burned clients from the casinos, these new binary options and Forex companies would target people who they thought were addicted to gambling, persuading them to progress into a more legitimate trading opportunity.
They’re Not Only Stealing from You
Being privately held businesses without shareholders or regulators to hold accountable, binary options and Forex companies evaded any legal consequences. These companies do not go through due diligence when signing up users and it is believed that the majority of these leads are stolen. It is also understood that many companies recruit employees from their direct competition to steal clients, asking new staff members to copy lists of clients from their competition’s database.
Another way binary options companies procure leads is via affiliate marketers. These professionals also deal in stolen leads and are often former binary options brokers who sell burned leads’ details for hundreds of dollars per name, number and email address, which they lifted from their previous jobs’ database.
And that is the story of how binary options brokers found you, and why they are most likely calling you from Israel. If one of these companies have scammed you, contact Veronica Birman Law Firm – we focus on helping victims of binary options and Forex fraud.