The Financial Conduct Authority (FCA) in the UK added two new brokers to its long list of companies that illegally target British customers and offer financial services without a license.
The first is Prime Crypto (https://primecrypto.io/), owned and operated by Maplewalk – a company based in Bulgaria, which is illegally targeting British citizens, without a license, pretending to operate as a crypto exchange.
We should note that all companies operating in the UK should be registered and regulated by the FCA or another official financial authority in an EU country.
“Some firms act without our authorisation and some knowingly run investment scams”, FCA says in its warning. “Prime Crypto is not authorised by us and is targeting people in the UK. Based upon information we hold, we believe it is carrying on regulated activities which require authorisation”.
Besides, after checking Prime Crypto website we came across a rather unusual detail – in their “Terms and Conditions” the broker says that “all withdrawal requests will be subject to a 5% fee from the requested withdrawal amount” and this, we should note, is not a conventional practice.
The second broker, FCA warns about, is LDC Crypto (https://www.ldc-crypto.com/), which is basically “a clone company” of an FCA regulated firm – LD Capital Ltd.
To “clone” and steal the identity of a legit businesses is a new form of scam, fraudsters use to mislead investors.
“A new tactic has seen fraudsters using the name, ‘firm registration number’ (FRN) and address of firms and individuals authorised by us to suggest they are genuine. This is what we call a ‘clone firm’”, the FCA warns, adding that “fraudsters usually use this tactic when contacting people out of the blue, so you should be especially wary if you have been cold called”.
FCA advises all potential investors in the UK to deal only with companies holding legit licenses, which could be verified in the official, FCA supported register.
The watchdog also reminds investors, that if they give money to unregulated firms, they will not be covered by the UK’s Financial Ombudsman Service or the Financial Services Compensation Scheme, that guarantees up to 50 000 GBP of the trading capital.