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Securities Division issues orders against three binary options firms

JEFFERSON CITY, Mo. — In three separate orders, Secretary of State Jay Ashcroft’s Securities Division ordered Glenridge Capital, Tropical Trade and Morgan Finances to cease and desist after the firms each allegedly sold unregistered, non-exempt binary options — risky, all-or-nothing wagers — to Missouri investors.

The orders also allege that the three companies made untrue statements, omitted material facts or engaged in fraud.

An order against Glenridge Capital alleges that, from approximately April 2015 to October 2016, two Missouri residents, from Chesterfield and Lebanon, invested a total of approximately $170,000 through Glenridge Capital, which operates out of Dublin, Ireland. The investors’ accounts purportedly grew to $300,000 and $794,000. One of the investors has not been able to withdraw any of their investments or purported returns, while the other investor could only withdraw $17,500. Glenridge Capital’s website was offline when checked by the division on June 7, 2018.

In the Tropical Trade order, the division alleges that a St. Louis resident invested $92,000 through Tropical Trade, based out of Liverpool, United Kingdom, from approximately October 2016 to November 2016. Tropical Trade advertised returns as high as 400 percent. Contrary to those advertisements, the investor did not receive any returns. Tropical Trade has been completely nonresponsive to all requests from the investor to withdraw or reimburse funds originally invested. Tropical Trade’s website is currently not available, and during the last communication with the firm, a representative said that the company was now in Russia.

A separate order alleges that a St. Louis resident invested a total of nearly $39,000 through Morgan Finances, based out of New York City. The investor was promised returns of at least 65 percent when the investment was made. Morgan Finances has been unresponsive to requests for withdrawals and other attempted contacts by the investor. The firm’s website was offline when checked by the division on November 3, 2017.

“Binary option offerings continue to be a regular source of exploitation for unsuspecting Missouri investors,” Securities Commissioner David M. Minnick said. “Generally, investors in unregistered binary options have great difficulty getting any of their money out of their investment, even after being told they have major profits. Missouri citizens should stay vigilant and always make sure they understand the risks before investing their hard-earned money.”

The commissioner ordered the three firms to show cause why they should not have to pay restitution plus interest, civil penalties and costs of the investigations. Civil penalties total nearly $200,000 for Glenridge Capital, $120,000 for Tropical Trade and $70,000 for Morgan Finances.

Ashcroft urges all investors to know the risks. If you have any questions about an investment opportunity or wish to check the background and registration status of a financial adviser, please call the toll-free investor protection hotline at 800-721-7996, or go online towww.missouriprotectsinvestors.com to file a complaint.