BlocksInform
UK hosts at least 168 businesses accused of cryptography or forex scams, according to an independent analysis.
A joint investigation by media firms the Bureau of Investigative Journalism and the Observer published Jan. 29 found that organized crime groups are using the U.K. as their base due to its “lax regulation.”
The real number of crypto or forex companies based in the United Kingdom involved in scams is probably much larger than 168 as the number was calculated by looking at the lists of alleged shell companies and comparing them to reports of fraudulent activity on various websites.
About half of the businesses found were associated with the so-called "pork deli."
A pig-butchering scams is an insidious scheme where the scammer builds trust with the victim — often incorporating romance — before convincing them to deposit money or crypto onto a trading platform or virtual wallet that the scammer controls.
The fraudster then keeps "fattening" the victim and building additional confidence before persuading them to transfer a much greater amount, only to then do with the funds.
According to the report, victims were often contacted via social media or dating sites, like Tinder.
Additionally, Many of the victims interviewed in the report said that the societies seemed more legitimate because they were based in the United Kingdom, say that they would not have succumbed to the scam if the businesses had been located somewhere else.
Registering a business in the United Kingdom costs as little as ?12 ($14.85) and requires no ID, ensure that it is easy for fraudulent businesses to register and earn "false credibility".
Businesses must provide an office address in the United Kingdom for registration, however, As a result, some residential addresses have been bombarded with letters to businesses claiming office space.
“What’s been happening in the U.K. is unconscionable,” financial crime investigator Graham Barrow was quoted as saying. "We have known for at least 20 years that companies in the United Kingdom are being used in these scams and that we are probably the world's leading provider of scams."
Related: UK-native stablecoin integrates into 18,000 ATMs nationwide
The Government of the United Kingdom tried to crack down on crypto companies in the area, with the United Kingdom Financial Conduct Authority, which requires all companies engaged in activities related to cryptoassets to register with the United Kingdom by 10 January, 2020.
The regulator has been very stringent with its approvals, however, with many crypto-related businesses continuing to operate as unregistered businesses as it tries to find a balance between providing a safe environment for investors and supporting innovation in the industry.
