OctaFX sounded alarm bells as the FX broker spotted several fraudulent schemes imitating their brand and even trying to extract money from their customers ‘through deception’.
“If anybody happens to come across these impostors online, exercise extreme caution, since you could be convinced to put your money into fraudulent ploys, never seeing your funds ever again,” the CySEC-regulated firm said.
As per usual, this seems like yet another instance of a scam operation where an unlicensed company illegally assumes the identity of an authorized company so that traders will mistake it for the legitimate entity.
OctaFX said its warning comes amid increasing concern over the prevalence of clone scams as criminals seek to take advantage of social confusion created by the coronavirus crisis.
The retail platform explains that the criminal gangs running these scams can engage with victims through a number of channels, including adverts on social media platforms and search engines. The most sophisticated criminals not only use a slight variant of company details but will even clone OctaFX’s website domain name.
“Always assume that scammers will use some type of our OctaFX brand name as a variation,” it advised clients.
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Britons Lost £78m to Clone Firms in 2020
We already reported about that earlier this month when Malaysia’s financial regulator said a fraudulent clone platform had been posing as OctaFX. Although the firm is heavily regulated in Europe, such authorisations do not entail passporting rights to promote their products in Malaysia.
The broker warned that relying on the regulators alone was not enough in the battle against scams. As such, the financial industry as a whole has a role to expose copycat websites and to prevent investors from falling victim to them.
Most regulatory bodies post warnings about fraud and clone companies on its websites, with the number of relevant warnings issued by the FCA surpassing 1,100 in 2020.
Moreover, the FCA’s figures revealed that nearly £78 million was lost to ‘clone firm’ scams, where a fake company uses the details of a regulated business, in the same year. This figure was likely to be much lower than reality because many scams are not reported.
FX brokers are among those that have been targeted by rogue operators who clone their names and websites in an attempt to part unsuspecting investors from their cash.