The California Department of Financial Protection and Innovation (DFPI) has issued 17 separate warnings over two days against suspected cryptocurrency brokers and websites. Here are the details…
Warning against cryptocurrency sites from California regulator
DFPI, the regulator operating in the field of financial protection in the US state of California, has warned against cryptocurrency companies and websites. He shared a list of companies he warned about. The list includes Tahoe Digital Exchange, TeleTrade Options, Tony Alin Trading Firm, Hekamenltd/Tosal Markets Limited, Trade 1960, Yong Ying Global Investment Company Limited, Unison FX, VoyanX.com and ZC Exchange. Additionally, two copycat sites that seem to be the two big names in the crypto industry are also on the list: eth-Wintermute.net and UniSwap LLC.
The DFPI’s consumer alert page issued 17 alerts on December 27 and 28 stating that these companies “appear to be committing fraud against California consumers.” It is not common for DFPI to issue this many alerts at once. As we reported on cryptokoin.com, this suggests that the number of crypto scam reports may have increased in the last stages of the year. The DFPI usually issues occasional alerts about investigations into companies or alerts to certain events.
Fraud is common on dating apps
The last time DFPI issued such a large amount of crypto scam alerts was June 15. At that time, DFPI “rang the alarm bells” for 26 suspected crypto platforms. The alerts came in response to citizen complaints against brokers and websites. The DFPI disclosed that individuals suffered losses of $2,000 to $1.2 million in certain circumstances. But the DFPI only said that these websites “seem to be dealing with scams.”
The alleged main theme of most of these warnings was social media, messaging and dating apps. Through these platforms, scammers create a fake identity online to establish fake relationships or friendships. In this type of “love scam”, a scammer often spends weeks or months trying to fake a relationship to gain the victim’s trust. Then he slowly shifts the conversation to investments. It often entices them with investment “opportunities” that are too good to be true.
DFPI: Consumers should be careful
The ultimate goal is to get the victim to invest in crypto by transferring funds to a dodgy wallet address through a copycat version of a legitimate website (like UniSwap LLC and eth-Wintermute.net in this example). Alleged scammers are said to employ another tactic, described as the “Upfront Fee Plan”, where bad actors will charge large sums of money from scam sites to process fraudulent withdrawals. DFPI uses the following statements:
DFPI urges consumers to be extremely cautious before responding to any request for investment or financial services. DFPI says it is necessary to check whether an investment or financial services provider is licensed in California.
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