Financial crimes, including in the field of cryptocurrencies, have reached enormous proportions comparable to the spread of the epidemic. A corresponding warning was made by the chairman of the board of the British Financial Regulatory Authority (FCA), Charles Randall.
According to Randall, schemes for tricking individual investors are of particular concern. He did not give specific figures, but the Report on Crime in England and Wales for the tax year 2018/19 refers to 3.8 million such cases. This is approximately one third of all crimes committed (11.2 million).
“Investment fraud, when people are fraudulently deprived of their savings, is one of the largest types of financial crime in terms of the amount of damage, ” he said earlier this week at the Cambridge Economic Crime Symposium.
In May, the FCA reported that in 2018 the number of cryptocurrency scams and in the Forex scam markets has tripled – from 530 to 1834, and the total amount of investors' losses, although reduced, amounted to an impressive £ 27 million ($ 34 million). In most fraudulent schemes (81%), cryptocurrencies were featured.
Charles Randall said that the regulator’s strategy to combat financial crime can be divided into three parts: monitoring the activities of companies, warning consumers about the risks of fraud and closing unauthorized investment projects.
“Last year, we warned consumers more than 500 times about unauthorized firms, and currently law enforcement agencies are conducting more than 40 investigations in this area, ” he said.
Despite the restrictions that the FCA faces in its operations, the agency is taking steps regarding certain high-risk investment proposals. Among these, Charles Randall named the proposed change in the rules governing the field of p2p lending, as well as plans to ban the sale of cryptocurrency derivatives for retail investors.
In addition, the FCA chairman called on large Internet companies to strengthen measures to prevent leakage of user data, as well as immediately stop suspicious activity at the request of the authorities.
“I do not think that these measures will limit freedom of speech. I also don’t think that democracy in our society will weaken if we strike precisely targeted blows at online scammers, ” he added.
Recall that in September the FCA intends to complete the preparation of recommendations for cryptocurrency companies regarding the fifth EU directive on preventing the legalization of illegally obtained income and the financing of terrorism (5AMLD). Their final version is expected to be published in December 2019.
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