UK financial regulator raises alarm on crypto scams

UK financial regulator raises alarm on crypto scams

UK’s financial services regulator, the Financial Conduct Authority, FCA, has raised concerns over the rise of cryptocurrency scams.

The FCA said in a statement that scammers are using celebrity endorsements and upmarket addresses in London to deceive people into parting with their cash.

Quoted by Reuters News, the FCA said cryptocurrencies such as bitcoin and ether are not regulated in Britain, and the FCA said it has received a rising number of reports about investment scams that claim to offer high returns.

“UK consumers are being increasingly targeted by cryptocurrency-related investment scams,” the FCA said in a statement.

“Cryptocurrency fraudsters tend to advertise on social media, often using the images of celebrities or well-known individuals to promote cryptocurrency investments.”

The ads link to websites for investments either using cryptocurrencies or traditional cash.

“The firms operating the scams are usually based outside of the UK but will claim to have a UK presence, often a prestigious City of London address,” the FCA said.

Given that cryptocurrencies are not regulated, consumers are unlikely to get their money back, and are not protected by the Financial Services Compensation Scheme, the watchdog said.