CFTC files fraud charges against two affiliate marketers for binary options

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uBiome founders face fraud charges

The U.S. Commodity Futures Trading Commission (CFTC) filed fraud charges against two affiliate marketers for binary options trading.

In its complaint, the CFTC alleged that David Sechovich and Peter Szatmari, the two affiliate marketers, created and distributed millions of fraudulent solicitations to open and fund retail binary options trading accounts on websites operated by unregistered, off-exchange brokers.

Sechovich and Szatmari’ marketing materials with numerous false or misleading statements, including:

  • Misrepresenting that trading binary options would generate significant, even guaranteed, profits while minimizing or disclaiming any risks;
  • Claiming that the automated trading software had been tested and generated profits when, in reality, the software had not been tested, did not work as claimed, and in some cases did not exist;
  • Portraying actors or fake personalities as actual owners or users of the automated trading software, without disclosing that they were not real users of the software; and
  • Depicting fictitious trading results as real.

Additionally, the commodity futures trading regulator alleged that both affiliate marketers failed to disclose that they received a fee from the binary options brokers that they recommended every time a new account was opened and funded as a result of their solicitations.