Tribunal sanctions brothers for binary options scheme

By James Langton | July 26, 2022 | Last updated on July 26, 2022
2 min read
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A pair of brothers who violated securities rules by operating a binary options trading scheme have been ordered to pay $3.3 million and hit with market bans by Ontario’s Capital Markets Tribunal.

The sanctions stem from allegations against three brothers — David, Jonathan and Joshua Cartu — who were accused of unregistered trading and illegal distributions for enabling $1.4 million in binary options trading by investors in Ontario. The dual Canadian-Israeli citizens operated the scheme from Israel.

In 2021, the Ontario Securities Commission (OSC) settled with David Cartu, who agreed to a seven-year ban and a $300,000 penalty.

The regulator continued its case against the other two brothers, who didn’t participate in the proceedings.

In April, the tribunal concluded that they violated securities rules by engaging in unregistered trading and illegal distributions.

It also found that Jonathan “engaged in the deceptive practices” by using aliases and lying about the location of their operations, but that allegation was not proven against Joshua.

Now, the tribunal has handed down its sanctions in the case, banning Jonathan Cartu for 15 years, fining him $1 million and ordering $300,000 in costs. It banned Joshua Cartu for 10 years, and ordered a $500,000 fine and $100,000 in costs against him.

They were also ordered to disgorge over $1.4 million.

In its decision, the tribunal noted that “permanent bans may have been reasonable in these circumstances,” but that since OSC staff only sought bans of 10 and 15 years, it accepted those recommendations.

The tribunal said it concluded that the requested sanctions are “proportionate” to the misconduct and to similar previous cases.

“Jonathan Cartu’s and Joshua Cartu’s serious misconduct warrants a significant restriction on their ability to participate in our markets and administrative penalties that reflect the scope of the misconduct and act as a deterrent for these respondents and for like-minded individuals,” the tribunal said in its decision.

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James Langton

James is a senior reporter for and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.