A major British financial regulatory body is warning traders to be careful after fraud equal to around $34.1 million US dollars in value was reported.
The Financial Conduct Authority, which is responsible for regulating financial services and markets, announced in partnership with Action Fraud that a figure higher than £27 million had been reported as lost due to cryptocurrency and foreign exchange fraud.
The number of reports of fraud has also risen threefold, with more than 1,800 cases coming forward.
In a statement, the FCA said that there are several hallmarks of scams like these.
These hallmarks include promises of “get rich quick” success stories, as well as potentially fraudulent endorsements from public figures – or images of apparent wealth, such as luxury cars.
Leaders at the two organisations made it clear that they were willing to tackle the problem.
“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. Before investing online find out how to protect yourself from scams by visiting the ScamSmart website, and if in any doubt – don’t invest”, he added.
Pauline Smith, the Director of Action Fraud, added that traders and investors should do their due diligence before proceeding with an investment.
“These figures are startling and provide a stark warning that people need to be wary of fake investments on online trading platforms. It’s vital that people carry out the necessary checks to ensure that an investment they’re considering is legitimate”, she said.
“Action Fraud is pleased to be partnering with the FCA to raise awareness of online trading scams, and we hope it will help prevent more people falling victim. Remember, if you think you have been a victim, contact Action Fraud”, she added.
In its statement, the Financial Conduct Authority released a list of warnings to help people spot the signs of scams or potential scams.
In its list it advises customers to not “assume it’s real” when looking at an advertisement or a website.
It also suggests heading to the FCA’s own Financial Services Register, which offers a list of firms which have FCA authorisation.
“Use the contact details on the Register, not the details the firm gives you, to avoid ‘clones’”, it warns.
It also advises against taking up unsolicited offers too.
“Avoid uninvited investment offers whether made on social media or over the phone”, it said. “If you’re thinking about making an investment, thoroughly research the company first and consider getting independent advice.”
More broadly, the FCA will itself be running an advertising campaign on social media websites to raise awareness of the problem.
Its ScamSmart campaign, which it runs with the support of the City of London police force, is set to alert people to the risks they may face when investing online.
- Samtrade FX – What Happens When You Can’t Get Your Money Back From A Broker?
- Are NFTs Really The Next Big Thing?
- Is the Regulatory Clampdown on Crypto The Cause of Lower Prices?
- Three Arrested as Samtrade FX Suspends Operations
- eToro gives more reasons to start trading now
- 2022 – The Year Of NFTs – How To Buy Them Using A Regulated Broker
Samtrade FX – What Happens When You Can’t Get Your Money Back From A Broker?
Safest Forest Brokers 2020
|Broker||Info||Best In||Customer Satisfaction Score|
|#1||Your capital is at risk Founded: 2011||Global CFD & FX Broker||
BEST FOREX BROKER Visit broker
|#2||Your capital is at risk Founded: 2014||Global Forex Broker||
BEST SPREADS Visit broker
|#3||Your capital is at risk Founded: 2014||Global Forex & CFD Broker||
Best Trading Conditions Visit broker
|#4||67% of CFD traders lose Founded: 2006||Global CFD & FX Broker||
ALL-INCLUSIVE TRADING PLATFORM Visit broker
|#5||Between 74-89 % of retail investor accounts lose money when trading CFDs Founded: 2010||Global Forex Broker||
Low minimum deposit Visit broker
Stay up to date with the latest Forex scam alerts
Sign up to receive our up-to-date broker reviews, new fraud warnings and special offers direct to your inbox