The Financial Conduct Authority (FCA) has confirmed a permanent ban on binary options.
The ruling will mean that all firms acting in or from the UK will no longer be able to from sell, market or distribute binary options to retail consumers.
The FCA said the ban is in response to ‘widespread concern’ about the risks associated with the products. The rules are set to come into action next month on April 2nd.
The FCA added that it estimated the ban could save retail consumers up to £17 million per year, as well as reducing instances of fraud by unregulated companies.
Christopher Woolard, Executive Director of Strategy & Competition at the FCA, commented on the decision:
‘Binary options are gambling products dressed up as financial instruments. By confirming our ban today we are ensuring that investors don’t lose money from an inherently flawed product.’
The Financial Conduct Authority is a financial regulatory body in the UK.
The city watchdog operates independently from government bodies, and was previously known as the Financial Services Authority (FSA).
