The following are questions that the customers of the Defendants to this action may have at this stage in the case and the answers to those questions. The Receiver provides answers to each question below but may revise these answers as she obtains further information and documents related to the Defendants, their assets and their business operations that are the subject of the CFTC’s Complaint. Therefore, the Receiver encourages investors to visit this page periodically to see if the Receiver has revised any of these questions and answers or posted additional questions and answers.

Q.
What is a binary option?

A.
As explained in the CFTC’s Complaint, a binary option is a type of option contract in which the payout depends entirely on the outcome of a yes/no proposition. The yes/no proposition typically relates to whether the price of a particular asset will rise above or fall below a specified amount at a specified date and time. For example, the yes/no proposition might be whether the price of silver will be higher than $33.40 per ounce at 11:17 am on a particular day. Once the option holder acquires a binary option through payment of a premium, there is no further decision for the holder to make as to whether or not to exercise the binary option because binary options exercise automatically. When the binary option expires, the option holder is entitled to a pre-determined amount of money if the customer has made a correct prediction. If the customer has made an incorrect prediction, he or she gets nothing and loses the premium paid.


Q.
What is a receiver?

A.
A receiver is an independent, impartial fiduciary appointed by a court, tasked with receiving, managing, preserving and marshaling (i) assets that are the subject of the lawsuit giving rise to the appointment of the receiver, pending the final disposition of that lawsuit, and/or (ii) endangered or transferred assets in which the investors, customers and/or creditors of the defendant to the lawsuit have an ownership or other beneficial interest.


Q.
How do I report this matter on my tax returns? 

A.
The Receiver and her professionals are not permitted to provide any form of tax advice or counseling to any investor. Investors are encouraged to contact a tax attorney and/or accountant for any questions they may have regarding how to report this Receivership and their investments with the Defendants on their tax returns.