Judge Rosanna Malouf Peterson of the Eastern District Court of Washington signed an order that approved the final motion of consent judgment. This was in regards to a case targeting the individuals behind the Ivory Option and LBinary fraudulent binary options schemes.
Massive Fines For Financial Losses
This consent judgment was signed after a few months since the US Securities and Exchange Commission (SEC) had secured a clerk’s entry of default against Anton Senderov and Lior Babazara, the people behind both of these schemes.
As the consent judgment stipulates both Senderov and Babazara are severally and jointly liable for both pre-judgment interest and disgorgement, totaling to a fine of $560,773. This represents the profits that they had gained through their fraudulent conduct at large. Alongside this, the defendants are also liable for a civil penalty fine, totaling in $350,000
Forbidden From Ever Defrauding Again
Alongside this, the order further mandates permanent injunctions that prohibit the defendants from selling or offering binary options. Alongside this, permanent injunctions have been put in place to prohibit them from defrauding victims through any artifice, device, or scheme.
Both Senderov and Babazara have been charged with defrauding over 2,800 US-based investors, doing so through the sale of binary options online. The complaint from the SEC alleges that these two had defrauded investors through the use of two online brokers for binary options that they had controlled: Ivory Option and LBinary. Alongside this, both parties controlled and owned one LianTech Finance Marketing Limited. LianTech operated a call center within Isreal, which functioned as a so-called boiler room.
Preying On The Naive
As the complaint detailed, Employees within the call center had allegedly convinced various investors to open trading accounts for binary options. Alongside this, they encouraged the investors to deposit sizable amounts of capital within these accounts, as well. The employees of these call centers had lied to the investors regarding their professional background, and lied as to how they made money, as well.
They claimed they only made money if the investor made money, while the reality was that the brokers earned money from losses, instead. Thus, these employees held no incentive to benefit the investor, instead of gaining money from their downfall.
As one would imagine, most investors lost money, with an unlucky few losing the entirety of their savings. Even if the investor requested their funds to be withdrawn from their trading account, the binary options broker largely refused to do so.