UK: $2.5 Million Losses in Crypto-Related Scams Reported This Summer

British police have warned the public about fraudulent investment schemes involving cryptocurrencies, the volume of which has led to 2 million pounds ($2.55 million) worth of losses this summer, according to an announcement published August 10.

In the announcement, the police cite statistics prepared by the Action Fraud national reporting center for fraud and cyber crime, which shows that in June and July victims reported losses of $2.5 million in cryptocurrency scams. The average loss totaled to roughly 10 thousand pounds ($12,700 thousand) per person. 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.”

Fraudsters reportedly lure potential victims with “get rich quick” investment schemes in crypto mining and trading. When a person signs up to a fraudulent digital currency investment website, they are asked to provide personal data like credit card details or driver’s licence numbers to open a trading account. Once the victim makes an initial deposit, fraudsters persuade them to invest more to gain a greater profit.

In order to fight fraudulent activity involving cryptocurrencies, the City of London Police’s 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.

This week, the U.K. financial watchdog, the Financial Conduct Authority (FCA), issued two warnings over crypto-related “clone” companies, which claim to be authorized by the FCA. The first firm called Fair Oaks Crypto allegedly tried to hoodwink potential victims by claiming that they represent Fair Oaks Capital Ltd. 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.