FBI agents, accompanied by Israeli police officers, last week raided the offices of binary options software platform provider SpotOption, in the Tel Aviv suburb of Ramat Gan.
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Agents searched for documents related to the arrest in September of Lee Elbaz, the CEO of binary options technology provider Yukom, on charges of wire fraud.
SpotOption owner Pini Peter said the FBI operation was not a raid and that his company cooperated with law enforcement personnel, who received everything they wanted.
In an interview with TheMarker, Peter said SpotOption employees were not questioned. They connected to our computers and took the information, he said, adding that Israeli police were only there to accompany FBI agents but were not themselves handling the investigation.
When asked why the operation should not be considered a raid of SpotOptions offices if the police did not schedule the visit with the company in advance, Peter replied: That was in fact strange because our lawyers offices in the United States are cooperating and have provided all of the documents that the FBI has demanded. Pini said his company has nothing to hide.
Binary options involve placing a bet on whether the value of a financial asset, such as a currency, a commodity or a stock, will rise or fall in a fixed time frame, sometimes as short as a minute. Israel has been a major international center of binary options trading. In late December Yukom and its owner, Yossi Herzog, petitioned the High Court of Justice to block enforcement of a law, scheduled to take effect at the end of January, prohibiting Israeli companies from providing binary trading services to clients abroad. Providing the services to Israelis had already been made illegal.
Herzog was detained for questioning by the FBI last week, TheMarker has learned. His lawyer, Haim Levy, said his client insists that his company has done nothing illegal and said Elbazs arrest was groundless.
Peter said that he is not involved with the Yukom court petition and his company is no longer involved in binary options Im considering closing the company down altogether, he declared.
Because SpotOption has been one of the best known companies of its kind, there is concern in the field that the FBIs investigation will expose law enforcement officials to information from other companies that could lead to indictments.
SpotOptions name has been linked to the case against Elbaz from the time of her arrest in New York last year. The FBIs request for her arrest alleged that SpotOption provided Yukom with the technology for its binary trading platform.
SpotOption reports showed that between the second quarter of 2014 and the end of 2016, clients had deposited $98.9 million with a company in Caesarea called Binary Book, which shared offices with Yukom. Binary Book returned just $19.9 million to its clients during that period.
With reporting from Reuters.