- ASIC dismantles 95 fake crypto firms linked to over $35 million in losses.
- ASIC targets the growing threat of crypto and romance “pig butchering” scams..
- Over 1,500 claims received from victims across 14 countries worldwide.
The Australian Securities and Investments Commission (ASIC) has shut down a major global scam network. ASIC disconnected 95 companies that ran crypto and romance scams which resulted in more than $35 million losses. The businesses operated under fake information to offer valid services but carried out fraudulent activities that targeted unsuspecting investors.
The Federal Court of Australia authorized ASIC to terminate the companies because of their misconduct and fraudulent operations. These companies allegedly operated false crypto investment sites and romance scams also known as “pig butchering” scams. The fraud scheme involved creating fake connections with victims to lure them to invest money into nonexistent financial investments.
Sophistication in Online Fraud, Beats Regulatory Efforts
The network operators pretended to be authentic businesses, created professional websites and fake corporate profiles to build confidence with victims. These tricked victims to think that they communicated with trustworthy companies. ASIC Deputy Chair Sarah Court warned these sophisticated online scams use manipulation and false financial promises to deceive investors .
ASIC’s probe exposed the fact that these companies were incorporated with false information and lacked proper management structures. The regulator identified widespread fraudulent operations across various markets such as cryptocurrency, foreign exchange and commodities markets. ASIC has initiated the closure of 95 companies involved in fraudulent activities following the Federal court approval.
Approximately 1500 claims have been submitted by victims from 14 countries which include Australia, India and the United States. Provisional liquidators Catherine Conneely and Thomas Birch revealed that only three of the 95 companies had assets, which amounted to $33,018. The other firms are dip in debts with more than $38.6 million liabilities.
ASIC Proactive Approach to Combat Crypto Scams
ASIC combats online fraud by regularly taking down scam websites. The regulator shuts down 130 scam websites per week which brings the total websites taken down to more than 10,000 sites. ASIC’s Deputy Chair warned consumers to be vigilant.
“However, these scams are like hydras: you shut down one and two more take its place. That’s why we’re warning consumers that the threat of scams and identity fraud remains high. We remind consumers to be vigilant,” said Ms Court.
The victims of these scams have reported major financial losses. ASIC takes immediate action to prevent more harm for victims and recover some financial losses for victims. The regulator’s proactive approach underscores the severe danger of online fraud and the importance of continuous alertness.
Investors must exercise extreme caution in their deals on online platforms. ASIC urges the public to watch out for fraud and conduct due diligence before putting their money in any investment opportunities.
