Reports of cryptocurrency and foreign exchange scams in the U.K. grew threefold in the last financial year – spiking to 1,834 from 530 in the previous year, according to the country’s financial watchdog.
Citing data from Action Fraud, the Financial Conduct Authority (FCA) announced Tuesday that, although the number of reported cases has increased, total reported losses actually fell from about £38 million ($48 million) to £27 million ($34 million).
Nestled in the exhibition room at this year’s Consensus conference, the U.S. Commodity Futures Trading Commission (CFTC) had a message for conference goers as they weaved in and out of booths representing various projects and startups in the space: “Be on the lookout for virtual currency fraud” and if you see it, let us know.
“The Whistleblower Office of the Commodity Futures Trading Commission (CFTC) is issuing this alert to inform members of the public about how they may make themselves eligible for both financial awards and certain protections while helping stop [sic] fraud and manipulation relating to virtual currencies,” a handout from the booth reads.
The Federal Trade Commission (FTC) is suing a startup that promised its crowdfunding backers a smart backpack but instead spent its proceeds on bitcoin and credit card bills.
The complaint states that Douglas Monahan and his company iBackPack of Texas, LLC, raised $800,000 from consumers to “develop a handful of products” including a smart backpack that contained batteries to charge phones and laptops.
Another week, another bunch of crypto crimes. In what we hope will be a regular series of posts, we’ve rounded up the week’s biggest bits of crypto crime. First up? A Isle of Jersey victim who sent £1.2 million to scammers who pretended to offer him or her bitcoin.
The scammers – who authorities claim came from Norway – spent 18 months convicing the unnamed victim to give up their life savings for a “surefire” investment in crypto.
Losses arising from cryptocurrency hacks and fraud may have reached as high as $1.2 billion in the first quarter of the year, new research from blockchain analytics firm CipherTrace suggests.
The total figure includes over $356 million lost from exchanges (including QuadrigaCX’s $195 million) and over $850 million alleged to have been lost from the Bitfinex exchange by the New York Attorney General’s office last week.
The latest edition of “Targeting scams,” an annual report released by the Australian Competition and Consumer Commission (ACCC) revealed that the country saw a 190 percent increase in cryptocurrency scams, with a total of $6.1 million AUD ($4.3 million USD) lost to crypto criminals.
This marks a substantial rise from the $2.
Australia saw a surge in reports of scams involving cryptocurrencies last year, according to the country’s consumer watchdog.
In 674 cases, victims reported to the the Australian Competition and Consumer Commission (ACCC) and other government agencies that cryptocurrency had been used to pay scammers in 2018, with reported losses of AU$6.1 million (US$4.3 million), the ACCC said in its tenth annual “Targeting Scams” report on Monday.
Sensing a rise in crypto-related scams and fraudulent investment schemes, the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have issued a joint warning to investors, encouraging them to take a more thorough approach to verifying potential investments in the space.
The warning was published on April 24, 2019, by the SEC’s Office of Investor Education and Advocacy and the Office of Customer Education and Outreach at the CFTC.
As the Christmas holidays are almost upon us, there will be notable increase in the number of financial scams and phishing attempts. The cryptocurrency industry will be no different in this regard, as there are quite a few new campaigns making the rounds right now. Always be careful when clicking unknown links and receiving messages from people one has never had a conversation with before.
The Christmas Holiday Crypto Scams
No one will be really surprised to learn there will be an increase in the number of cryptocurrency-related scams throughout December 2018.
Jared Rice Sr., CEO of the Dallas-based bank AriseBank, was arrested by the Federal Bureau of Investigation (FBI) on Wednesday, November 28, 2018, and charged with six counts of securities fraud and wire fraud. Rice is accused of scamming investors out of more than $4 million through a cryptocurrency scam that promised federally insured accounts and brand-name credit cards.
Earlier this year, the U.S. Securities and Exchange Commission’s (SEC’s) regional office in Fort Worth, Texas, received an emergency court order to stop AriseBank’s initial coin offering (ICO) for the cryptocurrency AriseCoin, which Rice falsely claimed had raised a whopping $600 million.
Colorado Securities Commissioner Gerald Rome has issued a new batch of cease-and-desist orders against unregistered Initial Coin Offerings (ICOs) operating in the state, taking the total number of signed orders against ICOs in Colorado to 18. Today's orders follow last week's order issued by the North Dakota's financial regulators against a Russian-based ICO that promoted unregistered securities by impersonating Liechtenstein-based Union Bank AG.
In what is becoming an emerging trend, Twitter accounts of popular brands are being hacked in an attempt to scam unsuspecting users out of their cryptocurrencies.
Target and Google are two high profile targets that have seen their accounts taken over by hackers who, in turn, have used them to scam followers by advertising fraudulent crypto giveaways.
Google's G Suite Twitter Account is Hacked!! pic.
In a statement from the Securities Exchange Commission (SEC), an emergency relief action was filed to shut down AriseBank, which it described as “an outright scam.”
In a growing list of enforcement actions by the SEC, the complaint against AriseBank stated that the Dallas-based company had used deceptive tactics to raise what they claim was $600 million of its $1 billion goal in just two months.
In a story that is getting all too familiar recently, the Securities Exchange Commission (SEC) halted trading on yet another blockchain-related company stock, UBI Blockchain. The SEC explained:
"The Commission temporarily suspended trading in the securities of UBIA because of (i) questions regarding the accuracy of assertions, since at least September 2017, by UBIA in filings with the Commission regarding the company’s business operations; and (ii) concerns about recent, unusual and unexplained market activity in the company’s Class A common stock since at least November 2017.
If you’ve interacted with Facebook, you may have had run-ins with spam bots that infest your profile (or your friends’ profiles) and post links or advertisements without your permission. Well, the same malware that tells your friends to “Check out this link for 90% off a BRAND NEW pair of Ray-Bans. WOW!” is now being used to mine cryptocurrency. A downloaded client runs mining software that contributes hashing power to the malware’s source server. Unaware Facebook users may have downloaded this bot through links shared on Facebook Messenger.
Police in Canada have issued a warning over a bitcoin tax scam after more than 40 York region residents fell victim to fraudsters.
According to a report by CBC News, York Regional Police said that victims lost as much as 340,000 Canadian dollars (US$267,000) through the scam.
The fraudsters, who identified themselves as employees of the Canada Revenue Agency, threatened the victims with arrest for unpaid taxes if they did not send funds using bitcoin ATMs.