Today, the FCA has announced warned of the rise of fraudulent online trading platforms after the reported number of crypto and forex exchange scams more than tripled in the last financial year. It also found that the total losses from these scams amounted to £27 million.
Kevin Murcko, CEO at crypto exchange CoinMetro, commented:
Criminals follow the money, and this report from the FCA shows they are taking advantage of consumers’ lack of understanding about crypto assets. If you’ve heard about Bitcoin on the news but don’t know how to invest, you might be tempted by the offers.
My personal background is foreign exchange brokerage and the same scams have been operating in forex, long before cryptocurrencies hit the headlines. It is about targeting individuals with promises of high profits. The fact that the FCA has now grouped together crypto and forex fraud just goes to demonstrate this is the same old fraudulent activity but in a new guise.
The key message for investors is to always do your own research, and if an investment sounds too good to be true, it probably is.”
As reported by Yahoo Finance, the FCA said scammers use fake websites, fake celebrity endorsements, and social media ads promising high returns and quick profits to lure in victims. Social media accounts associated with these scams often carry pictures of luxury cars and watches.
We’re warning the public to be suspicious of adverts which promise high returns from online trading platforms,” said Mark Steward, executive director of enforcement and market oversight at the FCA.
Scammers can be very convincing so always do your own research into any firm you are considering investing with to make sure that they are the real deal,” Steward said. “Before investing online find out how to protect yourself from scams by visiting the ScamSmart website, and if in any doubt – don’t invest.”