‘Wolves’ who part people and their cash

A ‘GREED is good’ culture permeates the binary options sales centres, which are often in modern office blocks in Tel Aviv, Israel, or Bucharest in Romania. There are three stages to the process.

1: Generating new leads – names and phone numbers of potential targets

Companies circulate spam emails to millions of people a day all round the world. They evade anti-spam laws by routing traffic through countries with no effective regulation. The emails contain links to videos of individuals who have supposedly made fortunes by trading in binary options. Those who respond to the emails are put on target lists which generate a new lead every 30 seconds. An insider told us some companies spend millions of dollars a month buying ‘mug lists’ of potential targets.

2: Hard sell

Salesmen are operating out of call centres where the insider said there is ‘loud music, cocaine on the tables, video games, free booze, crates of whisky’. The hyped up traders work through to four o’clock in the morning so they can call European and American targets. They are told they have to convert a least one of their leads every day. Converting is persuading the punter to make that first investment of £250 or £500 and the sellers get a commission of around 45 per cent. Some companies have booked cinemas for special showings of The Wolf of Wall Street to their sales teams.

3: Retention

A separate group of more experienced and ruthless sellers then target the people who have made a first investment. These ‘wolves’ pressure investors to put in thousands. In some companies, these traders are expected to bring in $100,000 by the end of the month or be sacked. Most of the fraud takes place in the last ten days of the month because traders have to meet their bonus targets. The scam involves charging thousands of pounds to credit cards without proper authorisation. Successful salesmen are rewarded with invitations to free sex parties with strippers, prostitutes and drugs. The insider said: ‘I was never able to look at anyone in that office the same way again.’