The UK has seen a large increase in unregulated crypto brokers lately and, as part of a campaign to protect investors, warnings have been issued against these firms. The latest warning came only days ago involving VenetFX and Bit4X, which followed after the FCA warned investors off Cryptorobot365.
Unregulated cryptocurrency firms which promise to handle investments are on the rise in the UK, and the country’s FCA (Financial Conduct Authority) is putting investors on alert, naming companies including Cryptorobot365, which is unregulated, and the clone firms Bit4X and VenetFX.
FCA warns not to trust Cryptorobot365
According to the FCA, Cryptorobot365 doesn’t have a license to provide its services. The firm works through the website, where it claims to be completely valid and registered, which is not the case.
According to the FCA’s warning, investing in cryptos through this and similar firms cannot guarantee a refund if the investment results in loss. The FSCS only covers those firms that are regulated and have received official license to provide their services. This means that any funds invested through shady brokers might easily be lost, with no hope for a refund.
This has become a problem in the UK recently, and the country’s FSA has been in charge of combating unregulated brokers. One successful action occurred only a week ago when the FSA exposed Apex Tradex, a company that operated in the UK under a false pretense.
The FCA issues warning against clone firms
Another addition to the current situation includes a warning released by the FCA only two days ago. This warning was issued against two companies called VenetFX and Bit4X, accused of being cloned firms that claim to have proper authorization.
According to VenetFX, the firm operates under the company registered with the FCA called WorthIT Financial Services LTD. The FCA, however, claims that neither of these two firms is a part of Worth.IT, and are only exploiting the name of a company that doesn’t even exist anymore.
Additionally, the FCA stated that both firms are using a tactic where they falsely associate themselves with previously approved companies. They do so in an attempt to trick investors into believing that they are legitimate businesses. This is a relatively new tactic that came into use around two years ago when the first complaints from scammed customers started to come in.
There was controversy regarding these two fake broker firms, with reports indicating that the companies lack proper documents, or that their websites are using duplicated information.
As a response, Bit4X’s director, Matic Kočevar, stated that the firm had attempted to obtain the necessary licenses in the past. According to him, the company never defrauded or scammed investors, despite the fact that they are not regulated. He also added that the firm is focused on BTC trading and that it works closely in this area with Currenex and ADMD.