Introduction
In recent months, Banxso, a Cape Town-based trading platform, has come under intense scrutiny due to its alleged ties to the notorious Banc de Binary scam—a significant international binary options fraud that operated from 2010 to 2017. This investigation by Moneyweb has unveiled a web of connections linking Banxso’s owner, Harel Adam Sekler, to the fraudulent activities that plagued the binary options industry during its peak.
The Banc de Binary Scandal: A Brief Overview
Banc de Binary was founded in 2009 by Oren Shabat Laurent, and by 2012, it claimed to be the world’s most prominent binary options trader, boasting 250,000 clients globally. However, the company soon attracted the attention of global financial regulators, facing hefty fines and a class action lawsuit following its closure in 2017. Laurent, along with Banc de Binary, was fined a record $11 million by U.S. regulators for illegal trading activities, while the Cypriot financial watchdog imposed numerous penalties for deceptive practices and misleading marketing campaigns.
The Links to Banxso
Banxso’s relationship with Banc de Binary raises concerns. Sekler, who reportedly lives in Israel, has been identified as a director and owner of multiple entities involved in the operations of Banc de Binary across different jurisdictions, including Australia, New Zealand, Belize, and Canada. Despite Sekler’s denials, official documentation from sources like the Australian Securities & Investments Commission (ASIC) clearly shows his directorship in companies linked to the scandal.
Moneyweb’s investigation found three key documents proving Sekler’s involvement with BDB Services (Belize), a key entity within Banc de Binary’s structure. Despite Sekler’s attempts to dismiss these documents as fraudulent, the evidence remains compelling. The documents not only list Sekler as the owner but also reveal his full personal details, consistent with his public profiles connected to Banxso and its affiliates.
The Similarities in Business Models
Both Banc de Binary and Banxso exhibit similar aggressive marketing and trading tactics. Banxso, like its predecessor, attracts clients through fake and misleading advertising, promising high returns with minimal investments. These deceptive ads often feature celebrities such as Elon Musk and Johann Rupert endorsing fraudulent trading schemes, a tactic reminiscent of the fake CNN articles and videos used by Banc de Binary.
Banxso also offers highly speculative financial products like contracts for difference (CFDs), which are akin to the binary options provided by Banc de Binary. These products are marketed aggressively, urging clients to invest beyond the minimum $250 deposit, promising lucrative bonuses and high returns. Once onboarded, clients are managed by a team of “success managers” who employ upselling strategies to extract additional funds from them, mirroring the retention techniques used by Banc de Binary.
Sekler’s Defiant Denials
Despite overwhelming evidence, Sekler and his legal representatives vehemently deny any involvement with Banc de Binary or its associated entities. They argue that the documents showing his directorship are inaccurate, dismissing the claims as unsubstantiated. Sekler’s lawyer, Darren Hanekom, went as far as accusing Moneyweb’s journalist of harassment and unprofessional conduct for pressing the issue. These aggressive responses only serve to raise further questions about the transparency and legitimacy of Banxso’s operations.
Conclusion
The similarities between Banxso and Banc de Binary are striking, from the fraudulent marketing tactics to the speculative trading products offered. Banxso’s involvement in fake advertising and aggressive upselling resembles the modus operandi of its predecessor, suggesting a continuation of the same unethical practices. Despite denials from Sekler, the evidence points to a troubling connection that casts a shadow over Banxso’s operations.
As regulatory scrutiny increases and more victims come forward with stories of financial loss, the onus is on Banxso to prove its innocence and distance itself from the dark legacy of binary options scams. Until then, the controversial link to Banc de Binary remains a significant concern for both the company and its investors.
