In a move that indicates the Israel Police has finally begun to tackle the multi-billion dollar, ongoing 10-year plague of global fraud by Israel-based binary options companies, the Tel Aviv owner of a fraudulent binary options firm was arrested on Monday on suspicion of aggravated fraud, misrepresentation, false accounting, forgery, extortion and blackmail.
The suspect, Eliran Saada, 38, is the owner of Express Target Marketing, which has operated the SecuredOptions and InsideOption binary options brands. Police said his firm was engaged in fraudulent binary options trading, fleecing money from foreign victims. Saada was to be brought for a remand hearing later Tuesday at Tel Aviv Magistrate’s Court.
Following a complaint filed through a lawyer by a victim overseas, whom The Times of Israel understands is a woman from Singapore, Tel Aviv District Police launched an undercover investigation that lasted several months, culminating in Monday’s arrest of Saada.
A police statement alleged that the company engaged in the fraudulent practices widespread in the industry, as exposed by The Times of Israel in a series of articles dating back to March 2016. The victim, the police said, was duped into parting with her money by representatives of the firm, who misrepresented themselves, used forged documentation, and took from her more than half a million dollars.
Police also raided the offices of the firm and confiscated computer materials.
The Times of Israel reported on the activities of Saada and Express Target Marketing in November, in the case of another foreign victim, Tommy Rutgersson from Sweden, who began trading with SecuredOptions in May of 2016. Tommy and his brother Ronald put in close to 100,000 euros, all of which gradually disappeared, at which point SecuredOptions stopped responding to his phone calls.
SecuredOptions employees told Tommy they were located in London and used fake names, he told The Times of Israel, but he tracked the firm to Tel Aviv. He visited the Israeli Embassy in Stockholm to complain that he had been cheated out of his money, but to no avail. Nor were the Swedish authorities helpful.
He further discovered that the company had transferred his funds to Swedbank in Latvia, and from there to Ceska Sportilena (Erste Bank) in Prague, but neither bank was responsive to his pleas.
Rutgersson then contacted Nimrod Assif, an Israeli lawyer who was able to ascertain the real names, ID numbers and phone numbers of the brokers that Rutgersson had dealt with.
Assif filed complaints with the Israel Police and the Israel Securities Authority against the company’s owners and salespeople.
Rutgersson said he detailed his story to The Times of Israel so that others would not fall into the same trap. “SecuredOptions knows that we were retired, that we took out loans to fund our account and were vulnerable. They know the risk we took in that we trusted them completely. And despite that, they cheated us. We were naive,” he said at the time. “I hope there are good people in Israel who will help us.”
After his story appeared in The Times of Israel, Rutgersson ultimately got all his money back.
The Times of Israel has been exposing Israel’s fraudulent binary options industry in a series of articles since March 2016, beginning with an article entitled “The Wolves of Tel Aviv,” and has estimated that the industry here numbers over 100 companies, most of which are fraudulent. They employ a variety of ruses to steal their clients’ money, including lying about their identities, experience and location, taking unauthorized sums from clients’ credit cards, using rigged online trading platforms, and simply refusing to let clients’ withdraw their funds. The firms lure their victims into making what they are duped into believing will be profitable short-term investments, but in the overwhelming majority of cases the clients wind up losing all or almost all of their money. Thousands of Israelis work in the field, which is estimated to have fleeced billions of dollars from victims all over the world in the past decade.
The Prime Minister’s Office in October 2016 condemned the industry’s “unscrupulous practices” and called for it to be outlawed worldwide.
As The Times of Israel has documented, a large proportion of binary options fraud and some forex fraud as well emanates from call centers in Israel. The industry has been operating with little to no intervention on the part of law enforcement.
Since spring 2016, Israel-based binary options firms have been banned from targeting Israelis. A government bill — drafted by the Israel Securities Authority, the Justice Ministry and the Attorney General’s Office — that would shutter the entire industry here, barring it from targeting people anywhere in the world, was presented to Israel’s Ministerial Committee for Legislation in February.
Well-placed sources told The Times of Israel two months ago that the draft bill had encountered strong opposition from lobbyists who have the ear of some Knesset members.