Business

Dennis Wafula

Saudi authorities: Beware of crypto scams

The Saudi Arabia Ministry of Finance has issued warning to members of the public against yet another crypto scam. This scam is claiming to be linked to the Saudi riyal in order to lure investors.

According to the official warnings, a new crypto fraud company is luring unsuspecting investors by asking them to invest in a virtual currency. These scammers are reportedly using false information, suggesting that they have connections to the Saudi riyal.

In their warning, the Saudi Ministry of Finance explained that the fraudulent company is promoting what it calls the “CryptoRiyal and SmartRiyal” to swindle money from investors. The company is using the Saudi emblem of two crossed swords and a palm tree, which are national symbols. The Ministry warned:

Any use of the KSA name, national currency or national emblem by any entity for virtual or digital currencies marketing will be subject to legal action by the competent authorities in the Kingdom.

On their website, the company claims that the ultimate goal for this project will be to finance NEOM. Reportedly, NEOM is a small city and tourist destination that is currently under construction in the northern part of the Country.

While commenting on the matter, cryptocurrency expert Dr Assad Rizq told Arab stated:

Some of these companies are not regulated, they have no assets, and even their prospectus is sometimes copied from other projects. They hype and pump their project, so the price goes up. Inexpert investors, afraid of missing out, jump in, which spikes the price even higher. Then the owners sell up and make tons of money.

Rizq blames investors for failing to conduct proper research before boarding any project. He also added that lack of crypto knowledge has contributed greatly to these crypto scams.

Additionally, Rizq believes that lack of regulations has also played a significant role in facilitating the growth of crypto frauds in the region. Without rules, many are bound to use fake names and identities such as countries names or flags to aid their agenda.

Despite the growing crypto crime rate, authorities have stepped up to fight illegal activities in the region. Last month, authorities in Abu Dhabi region helped deport a crypto fraudster by the name of Dhaval Mavani who allegedly took part in swindling about 22,000 crores ($3.18 billion) from investors.

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