British Columbians urged to learn the signs of a crypto scam as losses reach historic levels

VANCOUVER, BC, March 22, 2023 /CNW/ – BC Securities Commission (BCSC), BC RCMP and Canadian Anti-Fraud Center (CAFC) urge British Columbians to protect themselves from crypto investment fraud by learning how to spot signs of fraud.

In 2022, British Columbians reported total losses of nearly 24 million dollars in crypto fraud, almost triple 8.5 million dollars reported the previous year, according to CAFC data. Canadians lost a staggering 530 million dollars to fraud and cybercrime in 2022, a 40 percent increase from 2021. The real cost is likely to be much higher. Only 5 to 10 percent of victims report fraud, CAFC data show.

Fraudsters use the popularity and complexity of crypto assets to target vulnerable investors, especially on social media. Recent BCSC research shows that young adult investors in BC are more likely to turn to social media for investment advice and information, and that they take a more speculative and risky approach to investing, with only 18 percent holdings crypto investments.

For Fraud Prevention Month, the BC RCMP, BCSC and CAFC want British Columbians to give themselves the information they need to detect crypto and other online investment scams.

As part of this effort, a new BCSC advertising campaign aims to show that not everyone crypto scams are obvious, but you can learn to spot the red flags. You can learn more about the campaign by visiting cryptoscams.ca, a new feature on InvestRight.org, the BCSC’s investor education website.

Investors can protect themselves by recognizing the following characteristics of a crypto fraud:

• Promises of “guaranteed” high returns on an investment: All investments have risks. Investors should question any investment that has a “guaranteed” return.
• Complicated jargon and language that is difficult to understand: Fraudsters often exploit the mystique of complex new technologies, such as blockchain or artificial intelligence, to project a veneer of expertise and authority.
• Unregistered seller: Many investment scams involve individuals or firms that are not registered to buy or sell investments. Always check AreTheyRegistered.ca before investing.
• Unsolicited offers: Be extremely careful if you receive unsolicited communications via email, phone, pop-up ads and videos on the Internet, or direct messages on social media.
• Pressure to buy: Scammers may try to create a false sense of urgency to take advantage of an investment “before it’s too late.” Take the time to research an investment opportunity, ask questions and talk to a registered professional before making a decision.

You can also reduce the risk when buying and selling crypto assets by using crypto trading platforms (also known as “cryptocurrency exchanges”) that are registered with Canadian securities regulators and avoid platforms that are prohibited.

Anyone who suspects they have been a victim of cybercrime or investment fraud should report it to their local police, the CAFC (either through its online reporting system or by phone at 1-888-495-8501) or to the BCSC.

Quotes:

Kurt Bedfordacting officer in charge of the BC RCMP Federal Serious and Organized Crime and Financial Integrity Unit (FSOC FI)

“If promises of high returns on an investment seem too good to be true, you’re probably right. Although our dedicated investigators at the BC RCMP Financial Integrity unit work hard to solve some of the most complex financial crime-related offences, investor education and prevention remains the first line of defense against falling victim to investment fraud.”

Sgt. Guy Paul Laroqueacting responsible at CAFC

“Investment scams, included crypto fraud, has directed and stolen Canadians’ hard-earned money. With reported fraud losses reaching an all-time high, the CAFC wants to encourage everyone to take the time to research investments and understand fraudsters’ tactics before ever sending money or personal information. Take advantage of CAFC’s and our partners’ online resources, and always report fraud. CAFC uses your reports to assist law enforcement and inform public awareness.”

Doug Muirdirector of enforcement at the BC Securities Commission

“Investing in crypto is risky, and one of the biggest risks is outright fraud. You can lose all your money. British Columbians should check out BCSC’s investor education website, InvestRight.org, to learn about the warning signs of crypto fraud and other information that can help anyone make informed investment decisions.”

About the BC Securities Commission (www.bcsc.bc.ca)

The BC Securities Commission is the independent provincial government body responsible for regulating the capital markets in the British Columbia through the administration of the Securities Act. Our mission is to protect and advance the public by promoting:

• A securities market that is fair and guarantees public trust
• A dynamic and competitive securities industry that provides investment opportunities and access to capital

Learn how to protect yourself and become a more informed investor at www.investright.org

About the Canadian Anti-Fraud Centre

The Canadian Anti-fraud Center (CAFC) is Canada’s central repository for information on fraud. The CAFC is jointly administered by the Royal Canadian Mounted Police, the Competition Bureau Canada and the Ontario Provincial Police.

SOURCE British Columbia Securities Commission

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