Gambling Commission is responsible for regulating gambling in the United Kingdom. It also supervises gaming law and since 2013 regulates the National Lottery. UKGC was established in 2015 and is sponsored by the Department of Culture, Media, and Sports. Since its establishment, UKGC has also been responsible for licensing the binary options brokers, but in 2018 that responsibility shifted to the Financial Conduct Authority. Latter is a financial regulator in the UK. Since it is independent of the government, it collects operating funds from the member of the financial services industry in the form of fees.
As explained by Play-casino-online.co.uk, binary options, simply put, are financial options where an associated party either gains something or does not get anything at all. “Binary options are a form of bet where you try to predict the outcome of events in financial markets. For example, whether a company’s stock price or a foreign exchange rate, will rise or fall over a defined period (sometimes as short as 60 seconds). The use of the word ‘binary’ refers to the fact that there can only be two outcomes to the bet. If your prediction is right you win the bet; if your prediction is wrong you lose,” – explains the Gambling Commissions website. The commission goes on to explain that unlike other forms of gambling, it does not regulate companies providing binary options. Instead, this responsibility falls on the Financial Conduct Authority.
One of the reasons for shifting this responsibility to FCA is that the size of binary options trading has grown immensely, and FCA is better equipped to handle its regulation. The change will mean that binary options will be regulated similarly to investment products. In addition, any complaints regarding binary options brokers will now have to be filed with the Financial Ombudsman Service.
Gambling Commission warns people about unlicensed operators in great detail and provides certain red flags that should alert the users. One of the biggest signs is when a company offers a product that is unrealistically good. “Be suspicious of ‘too good to be true’ schemes, such as promises of unrealistic returns on an investment. There are no guaranteed get-rich-quick schemes,” – UKGC warns. If an operator makes a false claim about who it is regulated by, it is very likely that a customer is dealing with a scam and should not establish a working relationship with them. If a person suspects a binary options provider to be unlicensed it is important to contact Action Fraud immediately.
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