Belgian Investors Lost $12M Due to Crypto Scams and Forex Scams
October 12, 2020 6:21 pm
According to a report by Belgium’s financial watchdog, scammers stole up to $12 million from an investor in the country using fraudulent ads.
On October 5, the Financial Services and Markets Authority (FSMA), warned the watchdog estimated that investors in Belgium had lost almost 10 million euros, roughly $11.8 million, between May 2019 and September 2020 to fraudulent platforms, including those dealing with cryptocurrencies.
The FSMA reported that such platforms scammed victims using fake advertisements on social media featuring pictures of celebrities, directing them to provide information to bad actors.
“These platforms often use very aggressive methods to try to persuade you to invest ever-larger sums,” the financial watchdog stated. “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.”
TYPES OF FRAUD
There are three frequent types of frauds: Fraudulent online trading platforms (27.87%), fake credit offers (17.29%) and fraudulent offers of wealth management and alternative investments (26.38%). These reports constitute 71.54% of all reports of fraud received by the FSMA (the Financial Services and Markets Authority) during the above-mentioned period.
To combat these types of fraud, the FSMA has just launched a digital campaign on Facebook against investment fraud. As part of this campaign, the FSMA is also making available a tool that will enable you to assess whether or not an investment offer you have received is fraudulent.
For investors in Belgium, scammers’ methods include contacting people by phone after being convinced to give up their contact details and offering to manage their assets. Fraudsters dangle “promises of high yields or even guaranteed returns.”
Though the FSMA’s estimate also included fraudulent platforms offering investments in binary options, foreign exchange market products, and contracts for differences, it may signify a surge in the number of crypto fraud cases across Belgium.
In May, Belgium’s economic inspectorate reported that despite multiple efforts to tackle fraudulent crypto schemes, doubling from 2018, global losses from cryptocurrency fraud and theft surged massively and countries like Belgium continued to suffer losses of almost $3.2 million due to cryptocurrency fraud in 2019. The country’s Federal Public Service reported $2.5 million losses to crypto scams the previous year.
Preventive Measures To Tackle Crypto Scams
Belgium authorities have taken multiple preventive measures to fight crypto scams so far while prosecution measures are still undecided. In 2019, the economic inspectorate reportedly sent a related query to the public prosecutor’s office for fraud and is still waiting for a decision.
In February 2020, Belgium’s Financial Services and Markets Authority (FSMA), blacklisted a bunch of 140 crypto-related fraudulent websites. However, previously, FPS Economy rolled out a website to raise awareness of the risks associated with crypto investments and also estimated that investors in Belgium typically lose about $152 million to such scams each year.
In February 2020, FSMA chairman Jean-Paul Servais urged the Senate to establish a “legal framework for the sale, purchase, and use of virtual currencies and all related financial products.” The official pointed out that fraudulent activities in the market will continue to impact investors if the industry remains unregulated.
“A legal framework should be established without delay this virtual money and related financial products, in particular, to protect consumers and the use of this virtual currency for criminal objectives”