- The Canadian Securities Administrators warns about fake crypto trading service providers claiming false authorizations and affiliations.
- 10 entities are now identified by CSA as fictitious regulatory bodies and organizations.
- CSA advises independent verification of organizations referenced by cryptocurrency firms.
The Canadian Securities Administrators (CSA) issued a cautionary message to Canadians, urging them to exercise caution when dealing with alleged cryptocurrency trading service providers. Apparently, these platforms falsely claim to be authorized or associated with non-existent regulatory or dispute resolution bodies.
Investor Alert: Some crypto websites use fake regulatory and dispute resolution organizations to appear legitimatehttps://t.co/Ptqx3RHjfg pic.twitter.com/2QIpwnJdcB— CSA_News (@CSA_News) June 20, 2023
According to the CSA’s warning, certain trading service providers are resorting to deceptive tactics to create an illusion of legitimacy. For instance, a fraudulent trading platform even claimed that its counterfeit certification validates its status as a dependable and trustworthy online trading platform, says the investor warning.
Some of these trading services’ websites reportedly featured links to fabricated regulatory or dispute resolution organizations, which have their own fake websites. The CSA added:
The websites appear to be credible at first glance, with references to complaint processing, dispute resolution, and providing redress to aggrieved investors. But upon closer inspection, the websites’ language can be awkward and unpolished, with errors in spelling, grammar or syntax – a common “red flag” of illegitimate entities.
The Canadian regulatory body identified 10 entities as fake regulatory bodies and organizations. These include the Financial Standard Commission FSC Canada, Financial Commission/Finacom PLC Ltd., Blockchain Association, European Financial Services and Exchange Commission, International Regulatory & Brokerage E-markets, and British Investment Commission/BIC PLC Ltd., among others.
Meanwhile, in the latest report, a Financial Commission spokesperson claimed, “We disagree with the information in the CSA’s notice and believe the regulator made a mistake. We have already engaged legal counsel in Canada and preparing a submission to CSA to remove this designation. We expect this issue to be resolved soon.”
Just last month, top cryptocurrency exchange Binance announced its exit from the Canadian market due to challenging regulations. Changpeng Zhao, the founder and CEO of Binance, was born in China but has been a Canadian citizen for decades.
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