Nadex Commends The Cftc’s Action Against Unregistered Binary Option Platforms
As the only CFTC-registered exchange that provides retail traders with direct membership and the opportunity to trade a complete array of binary options on forex, commodity futures, stock index futures and economic events, the North American Derivatives Exchange, Inc.
By Paolo Palazzi-Xirinachs
Tuesday, November 27, 2012 - 00:00
Nadex commends the U.S. Commodity Futures Trading Commission (CFTC) for its aggressive action yesterday to protect U.S. traders.
The CFTC filed a civil Complaint charging two companies based in Ireland, Intrade and Trade Exchange Network, with offering commodity option contracts to U.S. customers for trading, as well as soliciting, accepting, and confirming the execution of orders from U.S. customers, all in violation of the CFTC’s ban on off-exchange options trading. In announcing this action, the CFTC’s Director of the Division of Enforcement stated, “It is against the law to solicit U.S. persons to buy and sell commodity options, even if they are called ‘prediction’ contracts, unless they are listed for trading and traded on a CFTC-registered exchange or unless legally exempt.”
As a Designated Contract Market and a registered Derivatives Clearing Organization subject to regulatory oversight by the CFTC, Nadex fully supports the US regulator’s efforts to crack down on illegal off-exchange market activity, particularly when that activity is directed at retail traders. Timothy McDermott, Nadex’s Chief Regulatory Officer, stated: “Recent events have demonstrated the importance of regulation and oversight to protect the markets and especially the retail trader from fraud and abuse. The marketplace has seen a proliferation of unregistered platforms offering binary options to US residents and this action by the CFTC sends a strong message to the operators of those platforms that such activity will not be tolerated.”
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