UK Financial Watchdog Issues Second Crypto ‘Clone Firm’ Warning This Week

The UK Financial Conduct Authority (FCA) has sounded an alarm over yet another clone company on the cryptocurrency scene. In a second such warning in a week, the financial regulator said on Wednesday that a company called Good Crypto was impersonating FCA-authorized firm Arup Corporate Finance to lure and possibly scam investors.

Currently, the website of the fake venture is still live, offering a wallet that supports various digital currencies, including Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), Litecoin (LTC), Bitcoin Cash (BCH), NEM (NEM), NEO (NEO) and Dash (DSH). The firm assures investors that the service is “highly stable and secure”.

Apart from the questionable advertisement, Good Crypto provides contact details, which the FCA warns “may be false” or “mixed” with details of Arup. The regulator further noted that the real, registered firm has no association with Good Crypto.

The FCA warning comes just a day after the authority brought another suspicious operation to public attention. Fair Oaks Crypto has been revealed to be manipulating investors by claiming the name, the company reference number, and the address of asset management and advisory services provider Fair Oaks Capital.

“[F]raudsters usually use this tactic when contacting people out of the blue, so you should be especially wary if you have been cold called. They may use the name of the genuine firm, the 'firm reference number' (FRN) we have given the authorised firm or other details,” the FCA stated.

As cryptocurrencies are not regulated by the FCA, investments are not protected by UK’s Financial Services Compensation Scheme and victims are unlikely to recover lost funds. Thus, FCA has asked investors to be vigilant when investing in any company, noting that they should check first if the company is in the Financial Services Register or the Interim Permission Register. In the event that one finds a clone company, they should report the company to the FCA to stop the fraudulent activities and bring the criminals to justice.

Earlier this year, the FCA launched a cryptocurrency task force in collaboration with the Bank of England to examine the various ways cryptocurrency technologies can be supported and regulated by the authorities. In another attempt to protect investors, the FCA opened investigations on 24 cryptocurrency businesses to determine whether they require FCA authorization.