The Financial Conduct Authority has raised an alarm that the sum of £27 million has been lost to the activities of scammers on foreign exchange and cryptocurrency platforms. This hefty loss was for the 2018/2019 fiscal year alone. The government regulator also revealed that a total of 1,834 scam alerts were sent in last year. That was a shocking 400% rise in the spate of scams compared with the previous fiscal year.
Even though the FCA did not disclose the precise nature of the scams, it is very clear there is a big issue at hand. In its yearly publication, the Autorite des marches financiers (AMF) disclosed that there is now a change in the trend of targets of the scammers. According to the French regulator, the number of complaints emanating from cryptocurrency transactions went into overdrive in 2018. On the other side, there was an interesting and remarkably massive plunge in the number of scams linked to foreign exchange platforms . What the figures and reports are all suggesting is that there is a shift towards the cryptocurrency sector as far as scamming is concerned.
Tackling the Scammers
In the United Kingdom, the FCA is of the opinion that the typical victim of these scammers was swindled of the average sum of £14,600 (which comes to about $18,600). The regulatory body also insists that a vast majority of the scams were perpetrated on different social media pages. Pretending as rich individuals, prominent social media celebrities lure people into making massive gains by trading using links to their affiliate sites. Mark Steward is the executive director of enforcement and market oversight at the FCA and he stated that the body is issuing a serious note of warning to everyone. Users are implored to be very careful of online adverts that promise massive gains and profits from trading platforms.
He went ahead to state that scammers usually have sugar-coated tongues so it is necessary that you do not fall for their antics. The best thing is that you also take time to carry out your own findings into any venture that you want to invest with. This will allow you to know if you are dealing with the genuine parties or a set of unrepentant fraudsters. In order to ensure that you do not fall into the hands of swindlers, the FCA is planning to roll out a new initiative called ScamSmart.
This initiative is going to be executed on various social media platforms and also with the support of Action Fraud – a branch of the United Kingdom police force focused on battling fraud. Pauline Smith is the national head of Action Fraud and has shed more light on the collaboration. She said the body is very excited to be joining forces with the FCA regarding tackling online trading scams and prevent people from being swindled.
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