The proceedings brought by the United States Commodity Futures Trading Commission (CFTC) against fraudulent binary options scheme Yukom Communications and a number of individuals and entities linked to it continue at the Illinois Northern District Court. There is, however, little progress, if any, to report.

On January 27, 2021, a hearing was held before the Honorable Andrea R. Wood. It was continued to February 24, 2021.

The previous such hearing was held on October 2, 2021. Back then, the CFTC secured Clerk’s entry of default against Yukom Communications Ltd., Yossi Herzog, and Shalom Peretz. In July 2020, the regulator secured default entries as to Linkopia Mauritius Ltd, Wirestech Limited, WSB Investment Ltd, Zolarex Ltd., and Lee Elbaz, the former CEO of Yukom Communications.

The next step for the CFTC in this case is to fight Yakov Cohen’s motion to dismiss, as well as to secure default judgments against the defendants. Let’s note that the clerk’s entries of default against the defendants are usually followed by default judgments. These typically include the particular penalties against the defendants, such as fines and bans.

The CFTC proceedings against the Israel-based binary options scam have been ongoing for quite some time (about 17 months). Some of the reasons for the delays include difficulties in locating the defendants (especially, Yossi Herzog) and effecting service on them.

One of the key defendants in the CFTC case is Lee Elbaz, who is currently appealing from her prison sentence in a related criminal case. Her appeal from the sentence has also resulted in a delay to the resolution of the case. Put briefly, victims of the fraudulent scheme have yet to get any compensation.

Yukom Communications and the entities linked to it fraudulently sold and marketed binary options to investors located in the United States and throughout the world through two websites, known as BinaryBook and BigOption. The defendants misled investors using BinaryBook and BigOption by falsely claiming to represent the interests of investors when, in fact, the owners of BinaryBook and BigOption profited when investors lost money.

The fraudulent scheme led investors to purchase more than $100 million in binary options.

Representatives of BinaryBook and BigOption, working under Elbaz’s supervision, misrepresented the terms of so-called “bonuses,” “risk free trades” and “insured trades,” and deceptively used these supposed benefits in a manner that in fact harmed investors.