The City watchdog has sounded an alarm over yet another fraudulent clone, but this time shedding light on a cryptocurrency firm. The FCA said on Thursday that a company called GMT Crypto was impersonating regulated firm GMT Communications Partners LLP to lure and possibly scam investors.
The FCA warning comes just two weeks after the authority warned the public against the suspicious operation of Cryptobourse, which has been revealed to be manipulating investors by claiming the reference number of an FCA-regulated called Crypto Facilities Limited.
Although GMTCRYPTO doesn’t explicitly claim to be licensed by the FCA, they are in fact using the details of regulated companies in an attempt to convince investors that they work for a genuine firm.
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Specifically, GMT Crypto provides contact details, which the FCA warns may be false or mixed with details of GMT Communications.
According to the financial regulator, GMT Crypto operating from the website gmt-crypto.com is not authorized to promote financial services in the UK and has no association with the authorized firm. The company is located at 27 Old Gloucester Street London, and the website of the fake venture offers crypto trading. Apart from the questionable advertisement, its products are lacking any specifics.
The firm assures investors that the service uses “a sophisticated blend of engineering with experience of experience to empower thousands of marketers to access markets around the world through the use of digital currency entirely outside the traditional financial system.”
Citing the “concerns identified around consumer protection and market integrity,” the FCA was reportedly eyeing a complete ban on the sale of crypto-CFDs to retail investors. In a consultation with relevant stakeholders, the regulator touted the possibility of excluding derivatives referencing “cryptoassets that qualify as securities.” But in all cases, CFDs on cryptos would remain subject to ESMA’s restrictions on cryptocurrency CFDs, including lowering the maximum leverage that companies can offer.