Ukraine Police Arrests Online Trading Scammers

Ukraine cyber crime enforcement action against online trading scammers

Enforcement actions against illegally operating online trading platforms continue. This time in Ukraine. Late last Friday, Ukrainian police arrested seven members of an online trading scam scheme which operated across the Eastern European country. The scheme has been orchestrated by a 34-year old Ukraine under the brands “Trade12” and “HQBroker”. Police raided 26 offices and properties associated with the scheme.

According to police reports, the Ukrainian scammers acted via five companies, some of which were officially based in the Marshall Islands. The Trade12 platform (www.trade12.com) was officially operated by an EXO CAPITAL MARKETS LIMITED while HQbroker (www.hqbroker.com) was operated by the Marshall Islands company CAPZONE INVEST LTD. In fact, the activities were carried out in Ukraine by Ukrainian people. The scammers are also said to have manipulated their customers’ software in order to gain control over their computers and trading activities.

Illegally operating online trading platforms such as SafeMarkets, Golden Markets or Option888 have defrauded hundreds of thousands of investors around the world in recent years. Scammers such as the Israeli Gal BARAK and his accomplices have established a worldwide network of offshore companies through which the stolen customer money is laundered. The small island state of Marshall Islands with just 53,000 residents became sort of a hub as the official headquarters of many scam holding companies.

Between 2010 and 2017, these unregistered brokers received billions from binary options investors. Since 2017, binary options have been banned in most jurisdictions. Many binary options scam schemes have been crashed already by enforcement actions.

Actually, most of the illegally operating brokers have not passed on their clients’ orders to authorized stock exchanges or registered brokers. They simply faked the trades and kept the money. According to a study by AMF, the French Securities and Exchange Commission, almost all binary options investors lost 100% of their money. This is also because the unregistered online traders have not paid out the money to their customers even in the case of profits.