10 Million Euros Lost to Crypto Frauds in Belgium in One Year

This week, Belgium’s Financial Services and Markets Authority made a startling revelation. Cryptocurrency fraud victims have lost at least €10 million between May 2019 and September 2020, the financial regulator said.

Belgians Have Lost €10 Million In Cryptocurrency Fraud

Belgian citizens have lost almost 10 million euros to fraudulent crypto investment schemes. Belgium’s apex financial authority, the Financial Services and Markets Authority, said on Monday. According to the watchdog, this data is from May 2019 to September 2020. Speaking about the modus operandi adopted by the scammers and crypto robbers, the FSMA said:

These platforms often use very aggressive methods to try to persuade you to invest ever larger sums. They will also try to persuade you to let them take control of your computer remotely so as to be able to make certain payments.

Adding to its statement, the regulator pointed out ‘fake advertisements that typically use images of celebrities.’ Potential victims get beguiled by platforms displaying these adverts circulating on social media. When interested folks click on them, cryptocurrency shysters call them to ‘to discuss an investment offer.’

Apart from bitcoin and other cryptocurrencies, online robbers offer investment schemes in foreign exchange products and contracts for differences (CFDs) that can be traded in markets with commodities and shares.

The FSMA had already apprised users about potential cryptocurrency frauds and scam-filled activities in 2018. Since then, it has added fake credit letters to its list of unscrupulous investment offerings. These the regulator said claim ‘to offer loans on favorable terms but intend to steal money.’ Also, investors need to stay away from fraudulent wealth management and alternative investment scams, FSMA mentioned.

Is This Why The UK FCA Banned Crypto Derivatives For Retail Customers?

As per the latest update from the cryptocurrency scene in the UK, the country’s top financial watchdog, the Financial Conduct Authority (FCA), has banned the sale, marketing, and distribution of cryptocurrency derivatives and ETNs to retail customers effective January 6th, 2021.

The FCA enumerated several reasons to justify it’s latest banning move. Volatility in crypto prices, the so-called ‘lack of inherent value,’ and inadequate understanding of cryptocurrency systems are others. But the financial regulator also specified that ‘prevalence of market abuse and financial crime in the secondary market’ is why retail players should stay away from crypto derivatives.

Also, there is no legitimate need for retail customers to invest in these products, the FCA added. The most crucial question now is: Will these measures actually block the propagation of crypto fraud and scams? Will such a ban actually protect users?

In a world where fiat and traditional market scams are dominant and much more widespread than digital currency fraud, an outright ban on different crypto investment opportunities will only do so much. What is required is tightening law enforcement on scammers and the bad actors, which will eventually make crypto investment safe for users.

The article was first published on: Oct 11, 2020