Online business models evading tax or not filing on time

States, Centre discuss Jurisdictional issues too. The issue of multi-brand retail was also taken up in the meeting.

Internet Sales are Taxable

Misinformation about laws such as prohibiting the taxation of Internet access (Internet Tax Freedom Act) and limiting sales tax on interstate sales have led some to incorrectly believe that Internet sales income including online auctions is not subject to income tax.

If you are an online auction seller, you may have tax responsibilities. You may be subject to liabilities for income tax, self-employment tax, employment tax, or excise tax. Your sales may result in capital gains, nondeductible personal losses, or you may have ordinary business income.

Your Online Auction Income from Abroad is Taxable

There have been recent reports about the interest of the Internal Revenue Service (IRS) in taxpayers with offshore bank accounts. The IRS’ interest, however, extends beyond offshore bank accounts. The IRS reminds you to report your worldwide income including online auctions sales to foreign customers on your U.S. tax return and lists the possible consequences of hiding income overseas.

If you are a U.S. citizen or resident alien, you must report income from all sources within and outside of the U.S. This is true whether or not you receive a Form W-2 Wage and Tax Statement, a Form 1099 (Information Return) or the foreign equivalents.

Consequences for Evading Taxes on Foreign Source Income

You will face serious consequences if the IRS finds you have unreported income or undisclosed foreign financial accounts. These consequences can include not only the additional taxes, but also substantial penalties, interest, fines, and even imprisonment.

Reporting Promoters of Offshore Tax Avoidance Schemes

The IRS encourages you to report promoters of off-shore tax avoidance schemes. Whistleblowers that provide allegations of fraud to the IRS may be eligible for a reward by filing Form 211, Application for Award for Original Information, and following the procedures outlined in Notice 2008-4, Claims Submitted to the IRS Whistleblower Office under Section 7623.

Home Office Deduction

If you use a portion of your home for your online auction business, you may be able to take a home office deduction. In order to deduct expenses related to the business use of your home, you must carry-on a “bona fide” business, as well as meet other specific requirements. Even then, your deduction may be limited. To qualify to claim expenses for the business use of your home, you must meet both of the following tests:

Your use of the business part of your home must be:

  • Exclusive,
  • Regular, and
  • For your trade or business,


The business part of your home must be one of the following:

  • Your principal place of business,
  • A place where you meet and deal with customers in the normal course of your trade or business, or
  • A separate structure you use in connection with your trade or business.
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Breaking: Business Opportunity Scheme Operators Banned

Telemarketing and Selling Investment Opportunities; Will Return Millions to Consumers

The operators of a telemarketing scheme charged with bilking millions of dollars from consumers, many of whom are seniors or military veterans on fixed income, will pay approximately $7.5 million in consumer redress under a settlement with the Federal Trade Commission.

The stipulated final order also prohibits the defendants – who operated under names such as Building Money, Prime Cash, Wyze Money, and Titan Income – from telemarketing, marketing investment opportunities, and selling or otherwise benefiting from consumers’ personal information.

In October 2016, the FTC filed a federal court complaint alleging that the defendants sold bogus online investment opportunities to people across the nation. The descriptions of the “opportunity” varied, but typically involved buying or investing in e-commerce related websites, or participating in a profit-sharing program involving credit card companies and e-commerce websites. The defendants got hefty payments from consumers – some exceeded $20,000. At the FTC’s request, a federal court halted the scheme and froze the defendants’ assets pending litigation.

The FTC’s complaint names the scheme’s owners, Susan Rodriguez, Matthew Rodriguez and William “Matt” Whitley, and their companies, Advertising Strategies LLC, Internet Advertising Solutions LLC, Internet Resource Group Inc., Network Advertising Systems LLC, Network Professional Systems LLC and Network Solutions Group Inc. They are charged with violating the FTC Act and the Telemarketing Sales Rule, including calling numbers on the National Do Not Call Registry.

The stipulated final order imposes a $25 million judgment, partially suspended upon the defendants’ surrender of assets. The full judgment will become due immediately if they have misrepresented their financial condition.

The Commission vote approving the stipulated final order was 2-0. The U.S. District Court for the District of Arizona entered the order on March 8, 2017.

NOTE: Stipulated final orders have the force of law when approved and signed by the District Court judge.

To learn more, read the FTC’s information on Business Opportunity Scams and on Investment Risks.

The Federal Trade Commission works to promote competition, and protect and educate consumers. You can learn more about consumer topics and file a consumer complaint online or by calling 1-877-FTC-HELP (382-4357). Like the FTC on Facebook(link is external), follow us on Twitter(link is external), read our blogs and subscribe to press releases for the latest FTC news and resources.

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Casino Scam Exposed – Monte Carlo Poker Room

Casino Scam Exposed – Monte Carlo Poker Room

Its game over for another Las Vegas poker room as the Monte Carlo Resort and Casino officially stopped dealing poker in its eight-table room earlier this week.

“This isn’t a bluff. The poker room is now closed” is the message relayed to potential customers on the casino’s website. The property remains open for business, but live poker is no longer an option.


A mainstay on the Las Vegas Strip for two decades, the poker room closure is part of a plan by MGM ownership to renovate the hotel-casino. The upgrade will see part of the property renamed to The NoMad Las Vegas and Park MGM, with construction scheduled to conclude in late 2018.

Unfortunately, a new poker room is not included in the blueprints.

A blend of regulars, recreational players, and tourists were often on hand at the Monte Carlo poker room. It was a popular destination for low stakes action and more than a few players have posted on forums that they are sad to see it go.

How Many are Left?

The closure leaves the Las Vegas Strip with 19 remaining poker rooms and 268 poker tables, according to a December 2016 Nevada Gaming revenue report. Throughout the state of Nevada, six dozen poker rooms play host to a variety of poker action on more than 650 tables.

About 10 years ago, 26 poker rooms and nearly 400 tables were dealing hands on the Las Vegas Strip. The decline in action can likely be attributed to a number of factors, including, perhaps, diminished interest in the game among the general public.

The Monte Carlo poker room closure follows others such as Circus Circus and Tropicana in recent years.

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Titan Trade Exposed Binary Option Scam – Settlement $65M

Titan Trade Exposed Binary Option Scam – Settlement $65M

Following a multi-year investigation Titan Trade is to pay $65 million to settle with CFTC/SEC over allegations of illegally soliciting US clients.

The online brokerage and Liverpool Football Club sponsor Titan Trade has reached an $65 million settlement with US authorities after several years of investigations over it illegally providing binary options trading to US customers.

Following a multi-year investigation a number of charges hit Titan Trade from the CFTC in 2013, and now the company has reached a settlement with US authorities agreeing to pay $19 million in restitution and disgorgement, $1.7 million in civil penalties to the CFTC, and $11.3 million in civil penalties to the US SEC and the remaining $33 million in investment funds from the relieved investors associated with the case.

This is according to filings this week in a Nevada Court, including dockets 156 and 160, after docket 147 was filed on February 16, 2016 in the United States District Court, Nevada District.

According to people close to the developments, the judgements issued under docket 156 and 160 have been finalized (for the amounts mentioned above) while the agencies have not yet published their respective press releases as the judges for each stipulated case still need to sign-off on the plan for distribution (under docket 155).

The distribution will happen through a fund that will be created for $15 million of the settlement money for the CFTC and SEC cases, with the press releases to follow shortly from each regulator in the coming days ahead.  The SEC had no comments.

The broker had been allegedly soliciting US customers with binary options and related contracts on CFDs and forex products between 2011 and 2013 becoming one in many binary option scams, circumventing a U.S. prohibition on OTC binary options contracts. The company had a supposed ‘virtual office’ while its office address was listed in the Trump Towers in New York on its website.

Titan Trade said it neither admits nor denies the allegations, common language used in settlements with both the SEC and CFTC (as well as in NFA related cases).

A company spokesperson said “We look forward to putting this behind us,” while thanking the agencies, according to coverage by WSJ. The company’s founder Oren Laurent will pay $450,000 as part of the settlement.

The news follows CySEC’s recent fine for 950,000 euros requiring Titan Trade to pay up again, as covered by Finance Magnates, after the Cyprus regulator said it was preparing to issue more monetary penalty enforcement’s.

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Interactive Options operated by Pegase Capital LTD is suspended by CYSEC

Interactive Options operated by Pegase Capital LTD is suspended by CYSEC

Suspended Popular Binary Option Platform

The Cyprus Securities and Exchange Commission (‘CySEC’) announces that the authorization of the Cyprus Investment Firm ‘Pegase Capital Ltd’ (‘the Company’), with number 225/14,

is suspended, pursuant to section 26(2) of the Investment Services and Activities and Regulated Markets Law of 2007, as in force (‘the Law’), as there are suspicions of an alleged violation of:

1. section 6(8) of the Law (CIF authorization),

2. section 28(1) of the Law, due to the Company’s possible non compliance at all times with the condition of its authorization provided for in section 12(1) (Persons who effectively direct the business of a CIF), section 13(2) (CIF shareholders) and section 18(2)(a), (d) and (j) (Organisational requirements) of the Law, and in the relevant paragraphs of Directive DI 144-2007-01 of 2012 for the Authorization and Operating Conditions of CIFs,

3. section 36(1)(a) of the Law (Conduct of business obligations when providing investment services to clients) and paragraph 6 of Directive DI 144-2007-02 of 2012 for the Professional Competence of Investment Firms and the Natural Persons employed by them.

The above decision was reached due to the fact that the aforementioned alleged violations may possibly endanger the Company’s clients’ interests and generally the smooth operation of the capital market.

Within one (1) month, Pegase Capital LDT has to take actions in order to comply with the aforementioned provisions.

While the suspension of the authorization is in force, the Company:

1. Cannot provide/perform any investment services/activities, pursuant to section 26(5) of the Law. 2. Must, if existing clients so wish, without being considered in violation of section 26(5) of the Law,: 2.1. Close all open positions in relation to clients’ contracts, on their maturity date or on an earlier date, if the client so wishes.

2.2. Return to existing clients all of their funds and profits earned through the channel binary option chargeback

In case you yourself got scammed, don’t hesitate to recurr to Redress Chargeback. We can recover that!

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Is there really a thing such as “legit money making” Binary Option Company? (FAQS)

Is there really a thing such as “legit money making” Binary Option Company? (FAQS)

The simple answer is No!

From Redress Chargeback years of experience and our on-going investigations we have uncovered many truths that may shock and surprise you.

Do prices on Binary platform match the market?

The closing price of any trade that you open will always be market price. The price that the company offers you when you are opening the trade will never be the market price. This is why you will see a couple of seconds before your trade closes you will see a quick movement (correction) so it will match the market price. Please note that the companies do not hide this, at least the regulated have this in the small print.

How do binary companies make money?

Contrary to what every broker will tell you. When you lose a trade the broker and binary company win!!!. They have absolutely no other means of making money other than when you lose.

Is my binary account secure & safe?

The company is in full control of your account. They can manipulate the prices of the assets offered on a client by client basis. If you are winning, they will make it harder and harder for you to keep on winning.

Does my binary broker have the relevant experience?

“Brokers, account managers or analysts” are none of the above. They are sales people. If your account manager claims to be a broker ask from him/her there personal broker licence number and which authority licences them. They will surely try to change the subject very quickly. Never take the advice of these sales people

Is this Gambling?

However strongly the binary companies try to market this as “investing” please be aware this is not investing in any sense of the word. This is GAMBLING. You are safer going into a casino than investing on a binary site.

Can you make money trading Binary Options?

Statistically you need to have a winning ratio of at least 57% just to break even. 99% lose in the first month and only 3% win, It means the rest of 97%

Lose. That is not easy!!. You have a better chance in a casino.

They will give me bonuses, risk free trades and gift

If you have an account with a binary company do not take any bonuses, benefits, gifts or insured, risk free trades from them. Nothing and I mean nothing is risk free or comes without strings attached.

I Researched the Company Before I Deposited

Any webpage that you see and it gives a particular binary options company a 4 or 5 star rating is probably owned by that company. Don’t fall for it!

But the Company is Regulated

Regulation: It does not really mean anything. Most big binary companies are regulated by so called “soft regulators” from small in descriptive countries, mostly tax havens. I have serious doubts whether any reputable regulator (FCA London, Baffin Germany or SEC USA) would ever regulate any of these firms.

Binary Option company is like an investment House….No?

No they are not banks or investment houses. They are media companies. Another issue is not just the actual Binary companies themselves, you have the service providers (Spotoption, Tradologic etc) these companies are facilitating all of the above scams. These are the main root of the problem. Anyone and I mean anyone can contact either of these companies and licence there platform software and start their own binary company in their garage. No due diligence, background checks… nothing.

In case you yourself got scammed, dont hesitate to recurr to Redress Chargeback. We can recover that!

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