Canadian Securities Administrators warn of crypto providers using “fake” regulatory and dispute resolution entities to appear legitimate.
Canadian citizens urged to verify crypto trading service providers due to the possibility of platforms utilizing “fake” regulatory bodies to enhance their credibility.
Canadian Securities Administrators issue Investor Alert warning about crypto platforms falsely claiming approval from regulatory authorities or dispute resolution organizations to create a false sense of legitimacy.
These platforms may have websites that initially appear credible, including references to complaint processing and dispute resolution, deceiving investors.
— CSA_News (@CSA_News) June 20, 2023
Canadian Securities Administrators highlight a concerning case where a crypto platform claimed a “fictitious certification” to present itself as a reliable online trading platform. However, closer examination reveals awkward and unpolished language, spelling errors, grammar mistakes, or syntax issues, which are common indicators of illegitimate entities.
These red flags serve as a warning for investors to exercise caution and skepticism.
The Canadian Securities Administrators (CSA) have identified several “fictitious” regulatory bodies and organizations, such as the Financial Standard Commission FSC Canada, Financial Commission/Finacom PLC Ltd., and the associated entity Blockchain Association. These entities are falsely claiming legitimacy in the cryptocurrency industry.
The Canadian Securities Administrators (CSA) state that none of the listed entities are recognized or known in the industry. Additionally, they caution that any entity claiming membership with these organizations is likely involved in fraudulent activities.
A list of crypto firms claiming membership in the “Blockchain Association” has been discovered on the organization’s website. However, the Canadian Securities Administrators (CSA) have labeled the Blockchain Association as one of the dispute resolution organizations accused of being illegitimate.
A purported list of Blockchain Association members with links to their websites. Source: Blockchain Association
The Canadian Securities Administrators (CSA) advise individuals to independently verify the existence of any referenced organization before engaging with a crypto firm that claims to be certified or a member of a dispute resolution organization.
The regulator further recommends that individuals interested in crypto investments should verify the firms against the ones registered with the Canadian Securities Administrators (CSA). Presently, there are 12 authorized crypto trading platforms operating in Canada, along with 11 platforms that have filed pre-registration undertakings.
It’s worth noting that the crypto firms themselves may unknowingly be victims of the “fake” certifications, and the inclusion of such certifications does not automatically classify a platform as “fraudulent.” This aspect is not directly addressed in the regulator’s statement.
The Canadian Securities Administrators (CSA) have identified several regulatory bodies and entities accused of being “fake.”
The list includes the Financial Standard Commission FSC Canada, Financial Commission/Finacom PLC Ltd., Blockchain Association, European Financial Services and Exchange Commission, Crypto Conduct Authority/Crypto Frugal Ltd. (Ireland), Crypto Conduct Authority/Crypto Frugal Ltd. (U.K.), International Regulatory & Brokerage E-markets, British Investment Commission/BIC PLC Ltd., International Financial Market Supervisory Authority, and Crypto Commission Authority/Crypto Commission Ltd.
Important: This article is intended solely for informational purposes. It should not be considered or relied upon as legal, tax, investment, financial, or any other form of advice.
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