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  • FCA believes that online  fraud is a grave problem of epidemic scale.
  • About 81% of all financial scams involve digital assets.

Financial crimes, including those that involve digital assets, have reached enormous proportions comparable to an epidemic.  The chairman of the board of the British Financial Regulatory Authority (FCA), Charles Randall believes that the schemes that target retail investors are especially worrisome.
 While he refrained from giving details, 3.8 cases were registered in England and Wales in 2018/2019 financial year according the recent report on crimes in the region. This is about one third of all crimes committed during the reporting period.

 “So fraud is a huge problem. It’s the most common crime in the country. And this volume of fraud has consequences which go well beyond the financial losses involved. Fraud can destroy not just the victim’s savings but also their mental and physical wellbeing. The devastating impact of these crimes hits not only the victims but also their families.” Randall concluded.

 In May, the FCA reported that in 2018 the number of cryptocurrency scams and in the Forex scam markets has tripled, and the total amount of investors’ losses amounted to £27 million ($34 million). Notably, 81% of fraudulent schemes involved cryptocurrencies.
According to Charles Randall, the regulator’s strategy to combat financial crime can be divided into three parts: monitoring the activities of companies, warning consumers about the risks of fraud and closing unauthorized investment projects.
The regulator issued over 500 warnings about unauthorized firms. Currently, FCA is investigating over 40 cases.
Despite the restrictions that the FCA faces, the agency is taking steps to deal with high-risk investment proposals. First of all, we need to discuss whether policymakers do enough to embed thinking about the risk of skimming and scamming into the savings and investment policies they make,” Charles Randall said.
He also urged large internet companies to tighten measures focused on private data leaks and halt fraudulent activities upon the request from the authorities.

“I don’t believe that these measures would prejudice the freedom of speech. Or that dissent and democracy in our society will be any weaker if we throw some well-aimed grit into the cogs of the online scammers,” he said.