SEC reaches settlement with Spot Option CEO Ran Amiran
The United States Securities and Exchange Commission (SEC) has marked progress in its binary options fraud lawsuit targeting Spot Option and its top management.
On November 8, 2021, the SEC filed a proposed final judgment as to Ran Amiran, Spot Option’s CEO and one of the defendants in this case. The document, seen by FX News Group, says that Ran Amiran consented to entry of the proposed Final Judgment without admitting or denying the allegations of the Complaint and waived any right to appeal from the Final Judgment.
The defendant is permanently restrained and enjoined from violating Section 5 of the Securities Act [15 U.S.C. § 77e]. He is also is permanently restrained and enjoined from violating, directly or indirectly, Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) [15 U.S.C. § 78j(b)] and Rule 10b-5 promulgated thereunder [17 C.F.R. § 240.10b-5], by using any means or instrumentality of interstate commerce, or of the mails, or of any facility of any national securities exchange, in connection with the purchase or sale of any security.
Further, Amiran is permanently restrained and enjoined from engaging in any activity that results in or is for the purpose of inducing or attempting to induce the purchase or sale of binary options, other securities, or securities-based swaps, over the Internet or via email or other forms of electronic communication.
Finally, he is liable for disgorgement of $103,365, representing net profits gained as a result of the conduct alleged in the Complaint, together with prejudgment interest thereon in the amount of $18,508, and a civil penalty in the amount of $78,000.
The case concerns a multi-million dollar fraudulent scheme involving unregistered offers and sales of security-based “binary options” to retail investors in the United States from at least April 2012 through August 2017. The scheme was overseen by Pini Peter and Ran Amiran through a company they owned and controlled called Spot Option, Ltd now known as Spot Option Tech House, Ltd.
The SEC’s complaint alleges that Spot Option contracted with third parties, which it referred to as “Partners,” “White Labels,” and “Brands”, to market its binary options. Unbeknownst to investors, Spot Option structured its business model so that its Partners were the counterparty on every trade. Under this structure, Spot Option and its Partners made their money principally from investor losses.
According to the SEC’s complaint, to make the scheme profitable, Spot Option set the payout terms on its options in a way that made it likely that most investors would lose all or a substantial portion of their investment within the first five months of trading. Spot Option trained its Partners, however, to deceptively market the binary options as profitable investments.
Spot Option used additional deceptive and manipulative practices to increase investors’ losses and boost Spot Options’ income stream. These practices included manipulating the trading platform to increase the probability that trading would be unprofitable and offering investors a so-called “bonus” to lock-up investor funds and prevent withdrawals, which, when combined with the payout terms, virtually guaranteed investor losses.
Through these and other deceptive and fraudulent acts, Spot Option sought and reached thousands of investors in the United States, including retirees, who traded through its platform. Many of those investors lost most of their money including, in some cases, hundreds of thousands of dollars meant for retirement. Spot Option and its Partners, on the other hand, raked in millions in profits, the regulator says.
Ran Amiran, age 50, resides in Israel. During the Relevant Period, Amiran served first as Head of Business Development and then as Spot Option’s President and Director. Around March 2017, Amiran took over as Spot Option’s Chief Executive Officer. During the Relevant Period, Amiran owned approximately 2.5% of Spot Option’s shares and, by the end of February 2015, was Spot Option’s second largest shareholder. Amiran was responsible for Spot Option’s sales, marketing and business development, and he managed the day-to-day relationships with Spot Option’s Partners.
Several days ago, the SEC obtained entries of default against the other defendants in this case – Pini Peter and Spot Option.
The proposed final judgment regarding Ran Amiran has to be approved by the Court before coming into force.