The Canadian Securities Administrators Warns Investors about Deceptive Crypto Platforms

The Canadian Securities Administrators Warns Investors about Deceptive Crypto Platforms

Altcoin news, News

To crack down on deceptive practices in the digital assets industry, the Canadian Securities Administrators (CSA) has issued an alert cautioning investors about cryptocurrency trading platforms that use fake regulatory authorities to appear legitimate. This alert was issued on June 20th.

 

The CSA, which regulates Canada’s financial markets, has discovered that certain crypto platforms are falsely claiming approval by regulatory or dispute resolution organizations to deceive investors. These platforms aim to enhance their credibility and attract unsuspecting individuals.

Initially, these deceitful platforms appear legitimate and offer robust mechanisms for handling complaints, dispute resolution, and compensating disgruntled investors. However, upon closer inspection, inconsistencies such as awkward language, spelling mistakes, and grammatical errors can be identified. The CSA has identified these inconsistencies as signs that these platforms may be illegitimate.

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The CSA has also published a list of fictitious regulatory bodies and organizations that these platforms have allegedly used to enhance their credibility.

The list includes entities such as 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.

The CSA strongly advises that any platform claiming membership or certification from these entities is likely to be fraudulent. They urge potential users of crypto services to independently verify the authenticity of these platforms before engaging in any transactions.

Although Binance, a leading crypto exchange, recently announced its exit from the Canadian market due to new regulatory norms, there are currently 12 authorized crypto trading platforms operating in Canada. An additional 11 platforms have submitted pre-registration commitments.

In the advisory, the CSA clarifies that the presence of a fake certification does not necessarily mean that the platform itself is fraudulent. It is possible for crypto firms to also fall victim to these deceptive certifications.

Compiled by Coinbold

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