UK’s FCA Warns of Crypto Scams

The UK’s Financial Conduct Authority (FCA) has become the latest target of cryptocurrency scammers. The scammers have been sending out emails from the UK regulators encouraging recipients to invest in crypto assets.

In the email impersonating the FCA, the watchdog’s logo was prominently featured. The scammers tell potential victims that Bitcoin was a long way from its peak price of $20,000 and that it could hit the same figure again or higher. The email asks recipients to click on a misspelt link titled “Click her”.

As soon as the scam was uncovered, the FCA was quick to confirm that it had not sent out the emails. It also added that it would never request bank details from members of the public. In a statement that it issued, the FCA said that these emails were likely to have come from criminals involved in organized fraud and cautioned the general public against responding to these emails. It also listed checks, such as verifying the mobile number or PO Box listed in the email, that the public can conduct in order to ascertain the email’s provenance. Any emails from a Gmail or Hotmail accounts are also not from the FCA.

The FCA has previous said that UK investors in the crypto sector lost $34 million due to crypto and forex scams between May 2018 to May 2019 this year. Previously, the agency has mulled a ban on all high-risk derivatives linked to crypto.

Crypto Scams Proliferate

With the rising popularity and mainstream media attention for cryptocurrencies, scams have proliferated in the industry. Most such scams are targeted at individuals or traders interested in making quick profits off the new asset class.

A recent scam involved a fake Twitter account supposedly belonging to Vitalik Buterin, cofounder of Ethereum. Scammers asked users to deposit Ether, Ethereum’s cryptocurrency, for an opportunity to get more crypto coins as giveaways. Of course, that never happened. Facebook’s much-publicized project Libra has also become popular with crypto scammers. A recent report stated that scammers were creating fake pages on Facebook and Instagram, with photos of the social platform’s founder Mark Zuckerberg and official marketing material from Libra. While their effect has not been quantified, crypto reports are estimated to have raked in millions of dollars.