Daily fraud update: 19th March

Chris Lee
CFTC Office Building entrance

CFTC, INTERPOL joins chorus of those warning of Covid scams

A major American regulator has joined the chorus of global financial industry authority figures warning traders and investors to be on the lookout against scams during the coronavirus outbreak.

The Commodity Futures Trading Commission (CFTC) followed in the footsteps of Britain’s Financial Conduct Authority as well as the Maltese regulator by emphasising the risks posed by unscrupulous scammers.

In a strongly worded statement, the regulator said that it would “aggressively” go after those who were breaking the rules during the crisis.

“During this period of market volatility, we want to ensure the public has important information to help detect and stop fraud”, the CFTC said.

“We will aggressively pursue misconduct in our markets tied to the impact of the coronavirus pandemic. There is never an appropriate time to prey on innocent people’s fears”, it added.

A wide range of asset classes are believed to be affected by the potential spike in fraud.

One such area is stocks, with some scammers appearing to promote fake schemes purportedly selling investment access to firms which are working to stop the spread of the virus.

That warning came recently from another American regulator, this time the Securities and Exchange Commission (SEC).

Crypto fraud is also expected to be on the increase.

Britain’s regulator, the Financial Conduct Authority, recently suggested that crypto scams could well rise in the face of the crisis.

Even INTERPOL, the international policing organisation, has issued a statement warning traders to avoid the risks of Covid-related fraud.

It released a range of tips designed to help traders ensure they were not exposed to scams.

“Be aware of bogus websites – criminals will often use a web address which looks almost identical to the legitimate one, e.g. ‘abc.org’ instead of ‘abc.com’”, it said.

It also encouraged traders to “be wary if asked to make a payment to a bank account located in a different country than where the company is located”.

The statement went on to outline that there have already been some cases reported to the organisations.

In one case, the amount of money lost was six figures in size.

“Monetary loses reported to INTERPOL have been as high as hundreds of thousands of dollars in a single case, and these crimes are crossing international borders”, the statement read.

“In one case, a victim in Asia made payments to several bank accounts unknowingly controlled by criminals in multiple European countries”, it added.

According to Jürgen Stock, who is the organisation’s Secretary General, a potential rise in cases could come from “fear and uncertainty”.

“Criminals are exploiting the fear and uncertainty created by COVID-19 to prey on innocent citizens who are only looking to protect their health and that of their loved ones”, he said.

The coronavirus outbreak continues to persist, and many nations around the world have closed borders and suspended usual economic processes.

Chris Lee

Latest news

Forex vs Crypto: What’s Better For Beginner Traders?
The crypto and forex markets are two of the world’s most popular among investors and traders. Read more
Three Great Technical Analysis Tools for Forex Trading
You don’t have to be very technical minded to make use of technical analysis in your forex trading. Read more

Safest Forex Brokers 2024

Broker Info Best In Customer Satisfaction Score
#1 73% of retail CFD accounts lose money. Founded: 2014 Global Forex & CFD Broker
Number One Broker
Best Trading Conditions Visit broker
#2 Blackbull LogoYour capital is at risk Founded: 2014 Global Forex Broker
Number One Broker
BEST SPREADS Visit broker
#3 AvaTrade LogoYour capital is at risk Founded: 2006 Globally regulated broker
Number One Broker
#4 plus500 logo81% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money. Founded: 2008 Global CFD Provider
Number One Broker
Best Trading App Visit broker
#5 Between 74-89 % of retail investor accounts lose money when trading CFDs Founded: 2010 Global Forex Broker
Number One Broker
Low minimum deposit Visit broker
#6 Forex Broker eToro Logo76% of CFD traders lose money Founded: 2007 Global CFD & FX Broker
Number One Broker
#7 XM LogoYour capital is at risk Founded: 2009, 2015 and 2017 Global Forex Broker
Number One Broker
Low minimum deposit Visit broker
#8 FxPro LogoYour capital is at risk Founded: 2006 CFD and Cryptocurrency Broker
Number One Broker
CFD and Cryptocurrency Visit broker

    Forex Fraud Certified Brokers

    FxPro logo
    AvaTrade logo
    plus500 logo
    BlackBull Logo Small
    FXTM Logo
    XM Logo
    eToro Logo
    CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.