Belgians lost 10 million Euro in crypto frauds and scams in one year according to the Financial Services And Markets authority reports. Following the report, we are reading more in our latest cryptonews.
This week, the Financial Services and Markets Authority of Belgium made a revelation saying that Belgians lost more than 10 million in EUR to crypto frauds between May 2019 and September 2020. The regulator said that the data was gathered in a year and speaking about the modus operating that is mostly adopted by scammers the FSMA said:
“These platforms often use very aggressive methods to try to persuade you to invest ever-larger sums. They will also try to persuade you to let them take control of your computer remotely so as to be able to make certain payments.”
Commenting further the regulation pointed out that there were fake advertisements that most usually use images of celebrities and lure people into investing. Potential victims get scammed by platforms that display these adverts circulating on social media so when someone is interested and clicks on them, the scammers call them to “discuss the investment offer.” Apart from Bitcoin and other cryptocurrencies, the online scammers offer investment schemes for making quick money and offer trading in markets with commodities and shares.
The FSMA already apprised users about the potential fraud activities back in 2018 but it has added fake credit letters since then to its list of unscrupulous investment offerings. The regulators claimed that these scams “ offer loans on favorable terms but intend to steal money.’ Also, investors have to be careful and stay away from fraudulent wealth management and investment scams. According to the latest update from regulators in the UK, the Financial Conduct Authority, it banned the sale, marketing, and distribution of crypto derivatives to retail customers starting from January 2021.
The FCA explained the reasons to justify the banning move as the volatility in prices and the so-called lack of inherent value are one of the main. The financial regulator also specified that the prevalence of market abuse on financial crime is why the retail investors should stay away from crypto derivatives. Also, there’s no legitimate need for the retail customers to invest in these products but the most important question is will the measures actually stop the propagation of crypto scams or will they protect the users?
Today we are witnesses of scams that are getting more sophisticated and dominant so an outright ban on crypto investment opportunities will only do so much. What is needed is tightening law enforcement on scammers and bad actors which will make crypto investment a safe option for traders.
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