The Bureau of Investigative Journalism (TBIJ) has identified 168 companies accused of running crypto or fraudulent foreign exchange trading scams in the U.K.
Victims of the scams are often approached — via social media, dating websites, and Whatsapp — and convinced to invest in crypto trading platforms — 17 of which have been confirmed as “pig-butchering” scams, according to the TBIJ report.
Losses total $3.4 million – no sign of recovery
The scams have totaled roughly $3.4 million (£2.8 million) in losses from victims scattered across the U.K., the U.S., Canada, Turkey, Germany, and Poland.
According to the report, most of the 168 companies identified were registered to London addresses and had at least one Chinese director. Loopholes in the U.K.’s company registration system contribute to the scam — due to the U.K. being viewed as a trustworthy location.
Government preventative measures warned.
The U.K. government pledged to “tighten the rules, including the introduction of a requirement to verify information provided to Companies House.”
However, financial crime investigator Graham Barrow warned that the reform is a welcome “step forward” but the legislation could pose “significant loopholes” — including ambiguity surrounding ID verification “for individuals using company service providers to register companies on their behalf.”
Barrow said:
“We have known for 20 years at least that UK companies are being used in these scams and that we are probably the world’s biggest provider of scam companies.”
Barrow described the U.K.’s inaction on crypto scams as an “abject failure,” suggesting more needs to be done to prevent these fraudulent activities — including verifying information provided to Companies House.
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