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UK Watchdog Reports Loss Of $34 Million In Crypto & Forex Scam Last Year

22 May 2019

In a bid to decrease the number of cryptocurrency related scam, FCA seems to be considering invoking a ban on – high risk derivative products linked to cryptocurrency assets for a short whileAs per a report published by Financial Times, UK’s financial regulatory authority FCA more commonly referred to as the watchdog has published a report which states that UK traders have lost nearly $34 million in cryptocurrency and forex scams during FY 2018-19. As per data published by the Financial Conduct Authority of UK which was gathered with help from U.K. national fraud and cybercrime reporting centre, Action Fraud and individual loss owing to scams decreased from $76000 to $18500 while total losses decreased by $14 million. But, the number of reports of scams rose by more than three times reaching count of 1,834 with 81% of the scams stemming from crypto currency market.As per the report in Financial Times, in a bid to decrease the number of cryptocurrency related scam the FCA seems to be considering invoking a ban on – high risk derivative products linked to cryptocurrency assets for a short while. FCA executive director Mark Steward was quoted cautioning, “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”. The FCA’s report to Financial Times also stated that scammers are using social media to find potential investors with most scams using pictures of celebrities with fake endorsements alongside imagery of luxury goods like cars and watches.As per a study conducted by initial coin offerings advisory firm Statis Group last year, more than 80% of the ICO’s in 2017 were scam which lead to loss worth nearly $1.34 billion. Similarly, a recent report published in the Cointelegraph website stated that new evidence has surfaced suggesting that Bitcoin exchange Goxtrade is a scam. According to report from the site, Goxtrade has been using real names and pictures of unaffiliated parties such as Amber Baldet, a cryptocurrency export who founded blockchain start-up Clovyr in their website staff page. Goxtrade is also not mentioned in U.K.’s registry of companies and businesses.Please feel free to let us know what you think in the comments below.

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