In June 2017, Britain’s Financial Compliance Authority (FCA) issued a warning about Stern Options for having targeted UK residents and conducting activities in the country that required authorization that that the company was never granted. In the same month, the New Zealand financial regulator, the Financial Markets Authority (FMA), issued a warning regarding of its own regarding SternOptions and added it to its “Businesses to be wary of” list, after received reports that representatives of the company were “cold calling” New Zealand residents.
Opened in July 2016, SternOptions was a binary options broker that was owned by BP1 LP, which was located in the Landmark Building, 14 Tsar Osvoboditel Blvd., Sofia, Bulgaria. Its phone number in the United Kingdom was +44 800 086 9172 and email address was firstname.lastname@example.org.
The site has since closed.
According to the Bulgarian government’s Financial Supervision Commission, the company was previously owned by BP1 LP, a British firm holding registration number SL026194 and limited partnership number SL26194, whose address was then Suite 2, 5 St Vincent Street, Edinburgh EH3 6SW, Scotland. Its previous address was 272 Bath Street, Glasgow G2 4JR, Scotland. Another company, DMD Technologies, was listed as a limited partner.
BP1 LP itself was registered by general partner Gum Ltd., whose address was C & H Towers, Corner of Great Marlborough and Great George Streets, Roseau, Commonwealth of Dominica.
The issue of the site’s ownership became even more complicated in 2017 when one former trader who was unable to recover her funds received a correspondence from Stern Options that appeared to link them to the discredited Bloombex Options. A London phone number provided by Stern was the same as one used by Bloombex, which was the subject of warnings issued by Canadian and Australian authorities the year before.
SternOptions came under public scrutiny after it falsely intimated in Facebook ads that Britain’s Lord Alan Sugar and consumer champion Martin Lewis had endorsed the site. “The claims made in these advertisements are baseless and entirely false,” the British peer’s spokesman said. “Lord Sugar does not condone, endorse or use any of the services purportedly offered by Stern Options and any claim to the contrary is entirely false and misleading.” Lewis said he “felt like crying” after hearing that one elderly pensioner had invested £150,000 in SternOptions having been led to believe that he recommended the site. The woman later recovered her funds through a chargeback.
SternOptions shut down their website shortly after this was publicized. A mirror site, SternMarkets, remains open.
SternOptions used the highly popular SpotOption trading software. This is a highly intuitive platform, so it enticed many people with zero experience simply because they were able to quickly learn how to use it. SpotOption also enables its users to follow other traders who were supposedly even more successful and automatically copy their investments onto their own accounts.
A mobile version of the platform could also be downloaded.
The website was available in English and German.
Unlike other brokers, SternOptions did not offer different account levels. Instead, it tailored its service to suit the needs of each client.
Registration was free and very simple. The minimum deposit was $250, later raised to $300. Clients were led to believe that their payouts were reaching 85%. Clients could also apply an “asset index” that was said to further increase their earnings. Maximum returns, therefore, were said to reach 94%.
The platform enabled supposedly included a comprehensive variety of some 200 stocks, currencies and commodities as well as the world’s main financial market indices.
SternOptions made bonuses available ranging from $US/£/$AU500 upwards. Clients who accepted bonuses were required to trade the equivalent of 27 times the amount of the bonus before being able to make withdrawals from the profits derived from it.
A demo account was available so clients could practice with the software before moving on to live trades.
Client payment were made by Visa, MasterCard, Maestro, or Diners charge cards, or wire transfer.
An online education center featured various written and video materials that were accessible to both novice and experienced traders. The training academy, which received rave reviews, was divided into beginners, in-depth and advanced sections.
The customer support team was available via email, telephone and live chat. Live chat was not available 24/7 but the phone support was. The support staff spoke English, German and Arabic. Dedicated customer support phone numbers were available in England and Scotland, Australia, Austria, Germany, Saudi Arabia, and Switzerland.
SternOptions was not licensed by any national regulator. It falsely claimed, however, to have applied for a license with the Cyprus Securities and Exchange Commission (CySEC). In response, CySEC declared that “Stern Options are not licensed or supervised by CySEC and investors should be warned that they are not protected by the legislation CySEC has in place to protect consumers.”