TEL AVIV, June 22 (Reuters) - Israel’s parliament is due to hold the first of three votes on Monday on a law that would ban the sale of binary options overseas by online trading firms based in Israel.
The proposed amendment to the country’s securities law, approved by the cabinet on Sunday, is expected to be fast-tracked through parliament.
Breaking the law will be punishable by up to two years in prison and if money laundering is involved, punishment could reach 10 years in prison.
Binary options involve placing a bet on whether the value of a financial asset - a currency, commodity or stock - will rise or fall in a fixed timeframe, sometimes as short as a minute.
Israeli regulators say they have received many complaints regarding losses suffered by binary option traders in various countries. Israel already banned the domestic sale of binary options last year, the first country to do so.
A Reuters special report published in September shed light on the rapid rise of the industry in Israel. London-based lawyers said hundreds of their clients were duped out of vast sums of money by some Israeli firms. More than 100 operators are estimated to be based in Israel, a technology hub. (Reporting by Tova Cohen, Editing by Ari Rabinovitch)