Israel Regulator Launches Criminal Probe Into Promotion of Pocket Option

The Israel Securities Authority (ISA) has opened a criminal investigation into Israeli citizens suspected of promoting the binary options trading platform Pocket Option, according to a statement from the regulator.

Binary options trading has been banned in Israel for several years. The ISA prohibited the marketing and distribution of such products domestically in 2016 following widespread fraud cases, and in 2017 extended the ban to include Israelis marketing binary options to clients abroad. Despite these prohibitions, the regulator stated that Pocket Option has continued to target Israeli traders, which it described as unlawful.

The ISA said Pocket Option operates from outside Israel and does not hold a local license. As a result, the platform is not subject to Israeli regulatory supervision. The regulator noted that the platform offers binary options trading, a derivative product that allows traders to speculate on short-term price movements and carries a high risk of total loss if the market moves against the trader.

According to the ISA, the suspects allegedly recruited clients via social media from 2023 onward. The authority said the promotion involved misleading information and false representations, which resulted in financial losses for investors. The investigation includes suspected offenses such as soliciting trades on an unlicensed platform, offering binary options, fraud, money laundering, and providing investment services without authorization.

Enforcement actions taken so far include searches of suspects' residences, seizure of evidence, detention of individuals, and the imposition of restrictive conditions.

The ISA reiterated that it has previously warned the public about Pocket Option and urged investors to avoid unlicensed platforms that promise rapid or guaranteed returns on social media, which it said may indicate fraudulent activity.

The regulator also noted that enforcement against binary options and similar products is not limited to Israel. While binary options trading is permitted in the United States under strict regulatory oversight, authorities there continue to pursue operators offering such products illegally. Separately, event-based contracts linked to elections, sports, or weather have drawn regulatory scrutiny, with U.S. authorities recently focusing on sports-related contracts and requesting the suspension of certain offerings.