Court hits operatives of BeeOptions scam with +$200M fine

A Texas court has ruled against Jonathan Cartu, Leeav Peretz, Nati Peretz, and their company, Blue Moon Investments Inc., for operating a fraudulent binary options scheme.

The trio, believed to be from Israel, along with their Seychelles-based corporation, were found guilty of offering illegal binary options and defrauding investors.

The case, which dates back to September 2020, concluded with the court imposing a heavy penalty on the defendants, totaling over $204 million in disgorgement and civil fines. The decision also includes a strict ban preventing them from trading in any capacity that would require registration with the U.S. Commodity Futures Trading Commission (CFTC) and from participating in commodity trading.

Investigations revealed that starting in late September 2015, the defendants operated an internet platform to offer unregulated binary options, misleading customers about the risks involved. They went as far as manipulating trade outcomes to ensure customer losses, thus profiting illegally over $51 million from U.S. investors.

Earlier in 2020, the CFTC filed civil charges against five Canadians, including three brothers with dual Canadian-Israeli citizenship, for orchestrating a binary options trading scam that defrauded investors of approximately $165 million. The charges point to a sophisticated operation that promised high returns to investors but was rigged to ensure losses.

Joshua, Jonathan, and David Cartu allegedly ran three binary options brands – BeeOptions, Glenridge Capital, and Rumelia Capital – through a call center named Tracy PAI Management Limited, based out of the Tel Aviv area in Israel. This operation, which has since been closed, was accused of serving as a “boiler room,” engaging in aggressive cold call tactics to sell questionable financial products to unsuspecting investors.

Adding to the charges, two more Canadians residing in Israel, Leeav Peretz and Nati Peretz, are accused of assisting the Cartu brothers in specifically targeting residents of the U.S., Canada, Singapore, UAE, and Britain. These individuals were lured into opening accounts with promises of quick and substantial profits, purportedly between 60-85%. However, the software system used for the trades was manipulated by the defendants to ensure that the investors would incur losses.

To facilitate the collection of payments for their binary options operations, the Cartu brothers are also alleged to have established two companies in Ireland. Furthermore, UKTVM Ltd., a company set up in the UK, and later Greymountain Management, incorporated in Ireland, processed credit card payments for their websites, as well as for other binary options brokers who struggled to secure banking services.

Between 2014 and 2017, the operation amassed around $165 million from global investors, including big numbers from the U.S. and Canada. Typically, once investors deposited their funds, they were unable to withdraw their investments.

The case also implicates Ryan Masten from Texas and his company BareIt Media, aka SignalPush, along with other offshore entities directly linked to the Cartu brothers, including All Out Marketing Limited, Blue Moon Investments, Ltd., and Orlando Union Inc. These entities and individuals were part of the broader scheme, with sales staff routinely misleading customers about their identity, location, expertise, and the profitability of the trades they were conducting.