Money Flash 90

The Israel Securities Authority (ISA) has recently initiated a move to ban so-called "Forex" and "binary" firms from targeting foreign citizens.

Binary and Forex companies are not allowed to target Israelis, so a law banning them from targeting foreign investors would in effect ban Forex and binary firms from seeking customers anywhere in the world.

ISA chief regulator Shmuel Hauser spoke to Attorney General Avichai Mandelblit, asking him to amend the relevant laws in order to allow Israel to impose a ban on binary activity targeting foreign citizens.

Mandelblit generally does not get involved in initiatives unless he is specifically asked to do so.

Many citizens feel allowing binary and Forex firms to target and harm citizens abroad damages the country's - and the Jewish people's - image as honest, straight, hardworking people and adds to the rampant anti-Semitism already being felt around the globe.

In addition, some financial experts warned the fraudulent industry was damaging Israel's global financial reputation.

Hauser has admitted to being "deeply troubled" by the Forex and binary fraud, and said his aim in turning to Mandelblit was to "put an end to the whole story" of the Forex-binary industry.

"All branches of enforcement are aware, and they all understand the problem," said Hauser. "The urgency of it is clear...What I am initiating now is legislation that will give us the means to regulate those [companies] that are based in Israel even if they are offering [binary options] to non-Israelis. They too will be covered by the legislation."

Last month, Hauser said the binary industry was "an ugly phenomenon that harms innocent people and unfortunately fans the flames of negative perceptions of Israelis and Jews."

Hauser also asked all regulators to contact the ISA regarding any local victims of forex or binary scandals.

"We’re saying to all regulators overseas who want our help, turn to us, and we’ll do the investigations for them. We can’t initiate it. They have to turn to us," he said.

Forex and binary industries work by convincing "clients" to invest their money, while giving them a false employee name and false location. When the clients call back, most are told that they have lost most or all of their money; if they wish to opt-out they are sent in circles, from one representative to the next, or told "no such person works here" when they ask to speak to the person who signed them up.

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