Financial Commission exposes crypto HYIP scheme
The Financial Commission, a self-regulatory compliance specialist for the financial services industry, has sounded an alarm over yet another fraudulent firm, but this time is shedding light on a cryptocurrency scam.
The FinaCom, as part of its intensified market supervision, said on Monday that a company called CRYPTO-FUTURE is an unlicensed trading provider, cautioning all retail investors about the risks of dealing with it.
Although the FinaCom didn’t provide further details, the aforementioned company seems to be a fraudulent business. Specifically, CRYPTO-FUTURE website claims to offer crypto investment plans, with returns ranging from 50 percent to 100 percent after 24 to 48 hours, which raises a red flag as far as investors are concerned.
As one would expect, sites such as CRYPTO-FUTURE operate as a High Yield Investment Program (HYIP) scheme where returns are always questionable, though they tend to dry up long before the original investment amount is repaid. The company provides no legitimate proof of payouts, and it is likely no one will ever see any money.
A glance at the website in question also reveals that the exchange does not confirm licenses held in any jurisdictions either.
Crypto firms have also been put on notice
The FinaCom has been sharpening its focus on retail investment and trading brokers in recent months. The regulator not only tries to protect consumers from FX scammers, but also has a dedicated tool to help cryptocurrency investors check if an investment opportunity is a scam.
Dubbed ‘Blockchain Warning List,’ the service provides information about the potentially damaging behavior of certain digital asset providers. The entries in this list include crypto exchanges and wallets suspected of conducting illegal activities depending on reports and complaints filed by their customers.
“Upon reviewing the submitted information from potential customers of this broker, the Financial Commission has determined that the indicated company and associated website may be used to scam and defraud traders and investors. As such, the Commission does not recommend doing business with this entity, either individuals purporting to represent this broker on social media and in private messages on popular messaging apps. Given this information, Crypto Future will be placed on the Financial Commission’s Warning List,” the circular reads.
And while the regulator recommends that investors use its database of member brokers and check their disciplinary records, it adds that its services for traders are offered absolutely free.
The FinaCom also notes that it only investigates claims that are filed against a member firm, where its Dispute Resolution Committee (DRC) uses a proven method to process complaints and deliver a decision. Financial Commission does not service customers of brokers who are not members, thus it cannot process complaints against non-members and no further action will be taken if the broker is not part of the organization.