Spoiler alert: virtually all online binary options trading platforms are scams.
As some of you already know, the design and content of Money After Graduation has recently been stolen and used as a front for a series of dummy websites set up to lure people into an binary options investment scam, called Magnum Options.
To date, more than a dozen websites have been set up with my branding and photos.
There’s a series of Facebook ads making outrageous claims that you can turn a few hundred bucks into hundreds of thousands, and claiming my name is Jessica Johnson or Gail Tanner and linking back to the Money After Graduation Facebook page:
Binary options platforms are a major online investment scam
Magnum Options claims to be a UK based online options trading platform, but I have yet to find any evidence that it’s a real company. Their corporate addresses are commercial office rentals in Australia and Britain. Their support line goes to an automated message. If you click a link on their website to their terms & conditions, you get a 404 error page.
I’ve been battling Magnum Options to stop their copyright infringement, intellectual property theft, and fraud since July, but they’re online scam artists and they’re better at this than me. They’ll use my website as a front until it stops working, or until I become too much of a pain in the ass, or until the DCMA takedown notices are finally executed. Then, I’m sure they’ll just do it again with someone else’s online property.
This is only one of many
Over the past few years, binary options trading websites have completely overtaken the internet. You only have to Google “binary options” to get hundreds of thousands of scammy results, each boasting a more exorbitant claim than the one before it.
The sites appeal to the same type of people who play poker online. But they somehow have an aura of being more respectable because they represent themselves as offering a form of investing. Don’t kid yourself. – Don’t Gamble On Binary Options, Forbes
Over the past 3 years, binary options trading platforms have overtaken the internet, luring desperate online users into high-risk gambling with the false promise of major profits.
What are binary options?
Binary options are a type of financial derivative that’s an “all-or-nothing” play — in other words, you place a bet that an asset will go up or down, and you either win a fixed amount or lose everything.
If you think that sounds a bit like high-risk gambling, that’s because it is.
The binary options being played on these dummy investment websites typically boast extremely short-term expirations, which is why they claim you can win hundreds of dollars in a matter of minutes. The idea that you can be thousands of dollars richer in a few hours is appealing, and exactly why casinos do so well. But you wouldn’t take your retirement savings to a casino, would you?
Trading options can be fun and highly profitable, but it’s not for the faint of heart, or inexperienced traders.
I didn’t learn how to trade options until the second year of my MBA in Finance. Even after 4-months of intense study and setting up a practice account in my financial derivatives course, I promptly lost a lot of money the first time I tried options in the stock market. By the time I finally learned how to trade options in a way that let me profit more often than I lost, I was tired of my emotional swings that accompanied market dips and rises. Options trading is still part of my portfolio strategy, but I’m terribly boring about it, sticking mostly to covered calls or statistically safe bets that don’t win me more than a few hundred dollars at time. Options trading increases the overall return of my portfolio, but aside from a few standard practices, it’s rarely worth the hassle.
In other words, I’m infinitely more comfortable with the risks of entrepreneurship than I am day-trading.
I hope that gives you a clue to how risky options trading can be. To say more, I would never participate in online binary options trading. I rarely let options expire worthless. If they’re out of the money and I don’t see a potential turn around, I take my losses and salvage what I can. I would never settle for the $0 that is the consequence of a loss with binary options trading.
Worse than payday lenders
The real irony in these online binary options scams is most of the time you aren’t even trading real options.
When you log into your account, it might look like the stock market, but it’s more or less a computer game, made up of fake options with fake prices.
You will lose or win in whatever proportion they need to sustain your belief in the system. When you lose, they will get you to deposit more money into the account. When you win, they will block your withdrawals do you can’t cash out.
Playing this market is nothing more than placing fake bets with real money. Your wins will never be real, your losses always will be.
Like many payday lenders, online binary options trading platforms prey on the most economically vulnerable people: those who are desperate for a “quick fix” to end their financial woes. Instead, their already desperate situation becomes even more dire when they lose what little money they have to an online binary option scam.
How to protect yourself from online binary options scams
Stay away from binary options, period. Binary options are not for you. They’re really not for anyone. They’re financial derivatives that are more or less equivalent to gambling, and the house always wins.
Check to see if the company is registered. Websites like the Canadian Securities Administration will let you check if a brokerage firm is a legitimate entity or a dummy company. Because most banks have a brokerage component that let you set up an account to make trades on the stock market, there’s no reason you should be going outside your primary bank to access the stock market. If your bank does not offer brokerage accounts, you can use a trusted online brokerage like Questrade. Be wary of any trading platform that has “options” in the title. It’s likely a scam.
Never gamble what you cannot afford to lose. If the possible outcome of any investment is $0, do not buy in with money you need. You cannot afford to lose your emergency fund, your retirement accounts, your house. You cannot afford to lose your sense of security or your dignity when you’re taken for a fool. It’s one thing to put $200 into a scam, lose it, and wish you had bought designer jeans instead. It’s quite another to give up $25,000 that would have made the difference between housing and homelessness in retirement. To enjoy any kind of financial security, you have to protect your wealth, and that includes protecting it from yourself.
Know that if it sounds too good to be true, it probably is. You will not make $430,000 this month. You are not special. You are not lucky. You have to get rich in a slow, deliberate way, just like the rest of us. The real path to wealth is consistent, disciplined savings and careful investing over years — not overnight successes. Getting rich is a matter of setting aside a large amount of your income diligently for years and years and years, until it grows into a nest egg that can support you and generates passive income.
I hope you found this post informative and helpful, and you stay away from binary options trading platforms.
This scam is BS on a whole different level. I’m so frustrated for you. I can’t even imagine. Also, what a fantastic reminder that if something seems too good to be true, it probably is.
Yeah! Stealing my intellectual property is a personal annoyance, but I am genuinely upset that they are scamming so many people. Until I looked into it, I didn’t realize how prevalent these online binary options trading platform scams are. It’s really sad.
I’m so sorry this is happening to you I can only imagine how frustrating it is! Keep fighting the good fight and know that all of us long time readers are rooting for you!
Thanks Allison!! I appreciate that <3
This is a hugely informative and interesting post on something I had actually never heard of before, so first, thanks for that. I didn’t know what binary options were, because I stay in the very shallow and conservative waters of investing, but I’m not surprised that this scammy BS would entice people who don’t do all the research.
And HOLY SMOKES I can’t believe they basically full on stole your entire site. That is so ballsy and outrageously corrupt. Maybe it’s because I’m pretty new to the whole, putting content on the internet thing, but it still just blows my mind that people do it, and by the sounds of it, get away with it – at least for some time. I hope all of your efforts to shut them down pay off soon!
Shallow investing waters are safe! People taking big risks when they don’t know how to swim are drowning.
(I love these metaphors for investing!)
Yahhhh I can’t believe they stole the entire site either, but if they’re scamming people out of money, I guess I can’t be surprised everything they do is shady.