Business 10 August 2018

Dennis Wafula

UK’s FCA warns investors against yet another crypto ‘clone firm’

The UK Financial Conduct Authority (FCA) raised the alarm on yet another cryptocurrency-related clone company called Good Crypto, which was reportedly impersonating an FCA-authorized firm to lure investors. According to the announcement, Good Crypto was using information from Arup Corporate Finance, which is already registered with the UK financial regulator, to deceive the investors.

On its website, which is no longer accessible at press time, Good Crypto displayed an address similar to that of Arup. The so-called “clone firm” also claimed to offer a wallet that supports various digital currencies like Bitcoin Cash, along with ETH, BTC, XRP, LTC, NEM, NEO, and DASH. Good Crypto also claimed to offer highly stable and secure services.

Arup Corporate Finance denied any links to Good Crypto, warning its investors not to engage in any activities with the fraudulent company. According to FCA, clone companies have increased over the last couple of months. Investors have lost a lot of money to fraudsters that claim to be running legit operation. Because the FCA does not regulate cryptocurrencies, authorities have not had an easy time identifying these clone companies. Many of the investors in the UK have yet to recover money swindled by the criminals. The Financial Service Scheme cannot compensate cryptocurrency investors unlike other investments in the UK.

FCA has urged British investors to exercise due diligence before investing in any company. To avoid getting scammed, people have also been advanced to check with relevant authorities the legality of companies they want to invest in.

The second announcement comes barely a week after FCA sounded the alarm on Fair Oak’s Crypto, which was using registered information belonging to Fair Oak Capital Limited to deceive investors. According to reports, Fair Oaks crypto claimed to offer a platform for cients to trade with Forex CFDs on cryptocurrencies, as well as precious metals and energy. FCA-regulated Fair Oaks Capital said the crypto clone company was not part of its group.

Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins.

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