The Financial Services and Markets Authority, the financial regulator of Belgium, has updated its fraud warning web page with the headline: “CRYPTOCURRENCY TRADING PLATFORMS: BEWARE OF FRAUD!”
The watchdog added today eight cryptocurrency companies that it considers suspicious – bringing the total up to a round 50.
The FSMA is an autonomous public institution created in 2011. It is a member of several supranational regulatory organisations such as ESMA, the International Organization of Securities Commissions, and the European Systemic Risk Board.
One of its remits is to issue warnings about entities which are perpetrating financial fraud and/or operating in the country without a licence. We have reported such warnings on numerous occasions. Before this year the organisation was mainly concerned with scams involving the notoriously fraudulent binary options industry. These scams include binary options brokerages that steal money, boiler rooms, which are basically very aggressive call centres, and a particularly despicable scam known as a recovery room, which involves hoovering up whatever money victims have left by pretending to be able to get their stolen money back for a fee.
The FSMA says on its website that the latest update features cryptocurrency trading firms whose customers complained about not getting their money back after investing.
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The website also features testimony from one customer who was stolen from; this individual (all names are redacted) was reportedly contacted by a French person who worked for a UK-based cryptocurrency exchange, and after a conversation sent the company some money for trading. Long story short, the individual then asked for a withdrawal and did not get it.
The FSMA notes that it compiles its list according to observations made on the basis of customer complaints. It warns people to be wary of promises of proportionate gains and to always verify the identity of who they are dealing with.
The French financial watchdog, the Autorité des Marchés Financiers, has a similar remit to the FSMA and made a similar update to its own website a few days ago. The warning is worded slightly differently; it speaks of four companies offering “atypical investments” made without authorisation. Two on the list appear to be the same entity (solutioncrypto.com/solution-crypto.com), although the latter is not a functioning website.
In March, the AMF published a list of 15 cryptocurrency companies that were operating without a licence.