Britain Loses $2.5 Million In Crypto-Related Scams This Summer

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The British police have warned the public about an increase in fraudulent investment schemes involving cryptocurrencies in the country.

According to the announcement published on August 10, about 2 million pounds ($2.55 million) worth of losses has been recorded this summer through crypto-related scams.

The above amount reported by the Action Fraud reporting center was for fraud and cybercrime victims for June and July.

The Director of Action Fraud, Pauline Smith said:

“It’s vital for anyone who invests or is thinking of investing in cryptocurrencies to thoroughly research the company they are choosing to invest with. The statistics show that opportunistic fraudsters are taking advantage of this market, offering investments in cryptocurrencies and using every trick in the book to defraud unsuspecting victims.”

How they fell victims to crypt related scams

Fraudsters reportedly lure potential victims with the promise of crazy returns within a short period should they make investments in crypto mining and trading.

On signing up to a fraudulent crypto website, they are asked to provide personal data like credit card details or driver’s license numbers to open a trading account.

Once the victim makes an initial deposit, fraudsters persuade them to invest more to gain a greater profit, the trend continues until the individuals can no longer cope.

The statistics of affected victims released by the U.K police department shows that the average loss totaled to roughly 10 thousand pounds ($12,700 thousand) per person.

London reacts to the increase in cyber crime

The London Police Economic Crime Academy (ECA) has reportedly developed a one-day “Cryptocurrencies for Investigators” course to train officers to recognize and manage crypto in their investigations, in order to fight the increasing menace.

This week, financial watchdog in the U.K, Financial Conduct Authority (FCA), issued two warnings over crypto-related “clone” companies, which claim to be authorized by the FCA but are not.

The first firm, Fair Oaks Crypto allegedly claimed to represent the asset management company Fair Oaks Capital Ltd., trying to trick potential victims.

The second, Good Crypto was reportedly giving out “false details or mix[ing] these with some correct details of the registered firm,” which in this case was London-based Arup Corporate Finance.

In a similar trend, the Thailand Police department yesterday announced the arrest of seven suspects in 5000 Bitcoin ($24 million) scam, one of which is an actor.

As the cryptocurrency industry is growing in magnitude, so also has the number of individuals looking to exploit individuals using this technology grow.

How to avoid falling victim of cryptocurrency scams

Cryptocurrency scams can take any form, from promised interests, to Ponzi schemes and new projects, individuals have lost their funds to fraudsters. To avoid being a victim of a crypto fraud, we advise that you:

  • Check for legitimacy: Before investing in a project, check whether the company is a registered corporation, the identity of the owners, and past records of the company. Scammers value their anonymity.
  • Beware of too good to be true offers: Individuals have made mammoth amounts from crypto project, but before investing, think about if the promised returns are really sustainable.
  • Stick to known services: one of the best ways to avoid being scammed is by sticking to the biggest and best-known services and name, although there can be limitations to the services they offer.
  • Get information: People have fallen to victims of scams paraded as new ICO’s and blockchain projects. Before choosing a new project, do a lot of research, and read their whitepaper too.
  • Use two-factor authentication. This usually involves having a unique code sent to your phone whenever you need to login, it can be difficult to always use, but it offers significantly increased protection.

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