In The Courts

The scheme related to sales, marketing and investor retention services provided by Yukom to two Web-based businesses, BinaryBook and BigOption, both of which fraudulently sold and marketed binary options to customers globally, including in the U.S.. Binary options involve speculating on the value of a financial asset such as currency or stock at a certain time of day — essentially betting on whether the price will rise or fall within a set period. In return for investing, option holders were promised that they would receive either a pre-determined amount of cash or nothing, depending on the accuracy of their prediction.

According to the evidence presented at trial Elbaz, in her role as CEO, and a number of co-conspirators fraudulently induced investors to deposit funds by falsely guaranteeing profits while misrepresenting expected returns and the nature of financial incentives being received by Yukom representatives. In scripted passages to be used with customers, Yukom sales people claimed to be representing the interests of investors ("I only make money when you are profitable") — when in fact sales commissions were based on net investor deposits and Yukom only made money if their customers lost money. Under Elbaz's supervision, sales representatives also made false statements about investors' ability to withdraw funds by relying on deceptive use of made-up benefits referred to as "bonuses," "risk free trades," and "insured trades."