Financial abuse, Consob obscures 4 sites: the most frequent frauds

With the most recent blackout order by Consob of 4 new websites illegally offering financial services, rises to The number of sites is 1079 overall blocked by the Commission starting from July 2019, when the Authority was given the power to order the blocking of the websites of abusive financial intermediaries. The sites for which Consob has ordered the blackout in recent days are “Toroassets”, “Interactive”, “CFD Active”, “XTXMK”.

The Authority made use of the powers deriving from the growth decree lawaccording to which Consob can order Internet connectivity service providers to inhibit access from Italy to websites through which financial services are offered without the necessary authorization.

Financial abuse: the most frequent cases

The most frequent casei in the matter of abusive provision of investment services are trading activities on forex and the binary options. In this regard, Consob specifies that “these instruments are not in themselves illegal; they become so if offered by unauthorized parties” underlining, however, that “forex and binary options are highly risky financial instruments” whose diffusion is rampant.


For Forexin general, means iccontracts for the purchase and sale of currencies adjusted for difference. Therefore, when we refer to the so-called “forex market”, – underlines Consob – we usually mean the foreign exchange marketi.e. a global financial market over-the-counter (OTC) in which operators negotiate directly with each other. In reality, this is not a real market or, at least, it is a very different market from those we generally know, such as the Milan Stock Exchange or the New York Stock Exchange. The forex market, in fact, it does not have a price list but is a “decentralized” international networkwhere traders (e.g., banks, investment firms, hedge funds, and individual investors) buy, sell, and trade currencies around the clock.

Investing in forex is often presented as a simple activity that gives immediate profits but – warns Consob – volatility should never be forgotten of currencies (significant and sudden movements in the price of the currency) and, above all, financial leverage. The leverage effectIn fact, it also allows you to invest small sums expose yourself to large volumes of currency and this means that both the gains and, above all, the losses are amplified, risking losing the entire sum invested quite easily.

Companies that propose to investors are increasingly frequent software that automatically generate operations on currencies based on predefined algorithms. By relying on these tools – underlines Consob – “we end up completely losing control over our investments, which can be made even when we are not at the computer”.

With forex – we read in the Consob guidelines – you can also lose a lot of money: according to a study by the AMF (the French financial markets authority) it emerged that out of 10 people who invest in forex, and mind you with authorized companies, 9 lose. It is easy to understand how the risk is even higher if the company is abusive, because in this case it could also be probable that the sums are not actually invested by the companies or that the trading software is manipulated.

Binary options

Perhaps even more insidious than forex are the binary options, financial instruments that are increasingly spreading due to their apparent simplicity. Binary options – explains Consob – have a structure (and therefore also the risks) similar to that of one wager as they ensure the payment of a predetermined amount if the event (reaching a certain price level of the security, index or other underlying) occurs within a certain time limit. In the event that the event does not occur, the investor loses all the invested sum.

Binary options they can be of various typesor type. The most frequent are those high/low, touch/no touch and interval, but in all cases the investor already knows in advance what his possible profit will be (fixed percentage of the option price) and his possible loss (entire investment price). An example of a binary option could be the following: will the value of copper in a week be higher or lower than today? For example, if the investor bets (it must be said) that he will be higher and guess he will earn perhaps 80% of the amount invested; otherwise he will lose everything.

Binary options with one have been spreading lately increasingly shorter duration, such as an hour or a minute. In this way, their betting nature is accentuated to the extreme because it is really difficult, if not impossible, to make predictions with a minimum of basis in such a short term.

So-called crowdfunding platforms

When a phenomenon is still little known by people it is easier to enter the system with fraudulent conduct. And this is how, with the advent ofequity crowdfunding regulated by Consob, so-called abusive crowdfunding platforms immediately emerged in parallel. First of all, it is necessary to point out that crowdfunding regulated by Consob is, to date, only equity crowdfunding, a tool that allows companies that can qualify as innovative start-ups to raise risk capital through online portals, in compliance with a whole series of measures to protect potential investors.

Innovative start-up companies, in order to access this possibility financingmust offer their shares or quotas only through crowdfunding portal managers authorized by Consob.

“Therefore, if the manager of the portal (i.e. the website) with which you come into contact is not included in the register of portals available on our website – Consob warns – it is possible that you are faced with an abusive activity and, probably a scam. So be very careful!”