BaFin publishes 3-page guide against online trading fraud

On 4 December, the Federal Financial Supervisory Authority (BaFin) published a guideline drawing attention to the dangers of international online trading platforms.

As the crypto scene has reported several times in the past weeks and months, more and more regulatory measures for crypto currencies are being implemented worldwide. Unfortunately, fraudsters have also discovered the promising possibilities of cryptos, and more and more people are becoming victims of online rip-offs and investing their money in dubious platforms that promise fast money.

According to a report by the Finance Magnate financial blog, a recent fraud case occurred in London. There the police arrested a fraudster who offered to trade binary options because he withdrew all investor deposits and had them disbursed in Fiat. At the same time, the platform made logged-in investors believe they were on the verge of a promising “win”.

BaFin has now published a 3-page guide explaining how potential fraudsters usually proceed; when a client invests in alleged financial difference contracts (CFDs), binary options or even promising cryptocurrency platforms, he is immediately contacted by an employee or “professional broker”. These people often present themselves as experts with many years of experience and often convince with their pseudo-expert knowledge and eloquent appearance. In addition, the platforms are usually structured in such a way that they show a supposed profit increase, whereby the customer feels more secure and thus makes further investments.

If one would like to pay out, one is often put off or even persuaded to pay in again so that a payout can take place. Fact is, these plants are supplied to no investment. The monies are transferred to different accounts abroad, since it concerns with the ?firm seats? offshore letter box addresses. Nobody knows exactly where the money went or who the real operator of the platform is – in the worst case you have lost your whole investment irretrievably.

Therefore the guide advises to be careful with offers, which guarantee a safe net yield, and to investigate sufficiently whether it concerns thereby a legitimate organization. One can also look up in the enterprise data base of the BaFin whether the enterprise is listed or not. And very important; you should never accept unsolicited calls regarding investment offers! That’s where most fraudsters hit at the beginning.

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