Financial Conduct Authority (FCA)
Protect yourself from scams
The FCA describes warning signs of investment scams, including unsolicited calls, promised high returns and websites that look identical to real firms.
The FCA, the SEC and the CFTC have each published descriptions of investment scam tactics. This page summarises the FCA's scam warning signs and the complaints and allegations described in a 2013 SEC and CFTC investor alert, without naming any firm.
Warning Signs the FCA Describes
On its guidance page "Protect yourself from scams", first published on 8 August 2017 and last updated on 19 January 2026, the FCA highlights several recurring indicators of investment fraud. The FCA warns: "Scammers often call out of the blue." The FCA also warns: "Fraudsters often promise tempting rewards, such as high returns on an investment."
The FCA explains that scammers might tell you that you have been specially chosen for an investment opportunity and that it should be kept a secret. Contact approaches can also involve social manipulation; the FCA notes: "Scammers often try to build a friendship with you to put you at ease." The FCA adds: "Fraudsters may try to influence your emotions to get you to act."
The FCA also says scammers might claim to be authorised and often appear knowledgeable about financial products. The FCA warns: "Fraudsters can be convincing and knowledgeable, with websites and materials that look identical to the real thing."
Under rules confirmed on 29 March 2019, the FCA stated: "As the sale of binary options to retail consumers is now prohibited, any firm offering binary options services to retail consumers is likely to be a scam." Readers can review UK market regulations in our guide to binary options in the United Kingdom.
Complaints the SEC and CFTC Described in 2013
In an investor alert dated 6 June 2013, the SEC and the CFTC described complaints and allegations received regarding binary options platforms. The 2013 alert outlined three main categories of alleged fraud.
First, the alert describes alleged platform conduct in which customers who were encouraged by brokers by phone to deposit more money were then refused withdrawals or repayment.
Second, the 2013 alert states: "The second category of alleged fraud involves identity theft." The alert says platforms allegedly collect sensitive personal and financial documents for undisclosed purposes.
Third, the alert says platforms allegedly manipulate trading software so trades lose, including extending the countdown to expiry on a winning trade until it becomes a loss. The 2013 alert cautions investors: "Do not invest in something that you do not understand."
To verify platform credentials before trading, see our guide on how to check whether a broker is regulated.
Unregistered Firms
The CFTC pages cited here carry no date in the text we reviewed. The CFTC states that a binary options platform doing business in the United States and soliciting money from U.S. residents that is not registered with the CFTC or SEC is likely fraudulent. For United States regulatory details, see our guide to binary options in the United States.
The CFTC explains that registration and a clean disciplinary record will not protect you from fraud, but notes that most scams involve unregistered entities, people and products. If you encounter suspicious entities or potential fraud, refer to our guide on how to report a binary options scam.
Frequently Asked Questions
What unsolicited tactics does the FCA identify in investment scams?
The FCA notes: "Scammers often call out of the blue." The FCA also explains that scammers might tell you that you have been specially chosen for an investment opportunity and that it should be kept a secret.
What software manipulation allegations did the 2013 alert describe?
The 2013 alert says platforms allegedly manipulate trading software so trades lose, including extending the countdown to expiry on a winning trade until it becomes a loss.
Why do regulators focus on unregistered binary options entities?
The CFTC notes that registration and a clean disciplinary record will not protect you from fraud, but points out that most scams involve unregistered entities, people and products.
Does regulatory guidance address individual liability?
This page summarises what the regulators' published guidance says. It does not address whether an individual could face liability. Seek independent legal advice.
Sources and Official References
- FCA: Protect yourself from scams (first published 08/08/2017; last updated 19/01/2026)
- FCA: Statement on permanent ban on binary options to retail consumers (29/03/2019)
- SEC/CFTC: Investor Alert: Binary Options and Fraud (6 June 2013)
- CFTC: Avoid Unregistered Binary Options Trading Platforms (no date in the text reviewed)
- CFTC: Be Smart: Check Registration & Backgrounds Before You Trade (no date in the text reviewed)
This page summarises what the regulators' published guidance says. It does not address whether an individual could face liability. Seek independent legal advice.
This page summarises what the regulators' published guidance says. It does not address whether an individual could face liability. Seek independent legal advice.