Apple and Google remove trading apps from stores on fraud fears

US tech giants Apple and Google have removed hundreds of mobile applications from their software systems in a huge crackdown on fraudulent trading apps.

Their decision was adopted on the heels of a review by the Australian Securities & Investments Commission into so-called 'binary options trading' platforms.

Binary options allow investors to make basic bets on whether a stock will rise or fall in value, with many doing so legitimately but hundreds of others found to have scammed users.

The ASIC’s investigation found there to be 330 apps which were unlicensed for operating binary trading platforms.

Binary options allow investors to make basic bets on whether a stock will rise or fall in value

The regulator added that the vast majority of the apps did not contain any warning of the risks of trading, with many making exaggerated claims of returns to be made by investors on the apps. A host of other tactics were highlighted by the ASIC in its report on the apps.

“On reviewing some of the comments that appeared with the apps, it seemed that some investors made money in the demo mode but lost money once they moved to a live trading system,” it said.

"Investors also need to make sure any financial service provider, regardless of the way that financial service is being provided, is adequately licensed and authorised to provide those services," it added.