17 cryptocurrency websites are suspected of fraud, says a California regulator.

The California Department of Financial Protection and Innovation (DFPI) has recently issued a warning about several cryptocurrency companies that are suspected of fraud against California consumers. The DFPI’s consumer alert page now contains 17 alerts from December 27 and 28 warning that these businesses “appear to be involved in fraud against California consumers.” The companies listed include Tahoe Digital Exchange, TeleTrade Options, Tony Alin Trading Firm, Hekamenltd / Tosal Markets Limited, Trade 1960, Yong Ying Global Investment Company Limited, Unison FX, VoyanX.com, and ZC Exchange. In addition, eth-Wintermute.net and UniSwap LLC are two imitation websites that are impersonating well-known names in the cryptocurrency industry.

The DFPI has received a large number of complaints about these companies, with some individuals claiming to have lost anywhere from $2,000 to $1.2 million. The DFPI simply states that these websites “appear to be engaged in fraud,” but does not provide any further details about the specific allegations. It is worth noting that the DFPI rarely issues so many notifications at once, which suggests that the number of complaints about cryptocurrency scams may have increased in the last months of the year. Typically, the DFPI will only issue notices concerning company investigations or alerts about specific instances. The last time the DFPI issued such a significant number of crypto scam alerts was on June 15, when it raised the red flag over 26 suspect crypto sites.

One common type of scam that has been identified by the DFPI is the “pig-slaughtering scam,” in which a person or group creates a false online persona to forge ties or friendships on social media, messaging services, and dating apps. The con artist will often spend weeks or months cultivating the fictitious relationship in order to win the victim’s confidence, before gradually changing the subject to investments and luring them in with investment “opportunities” that are frequently too good to be true. The ultimate goal is to convince the victim to invest in cryptocurrency, either by sending money to a dubious wallet address or through a counterfeit website like UniSwap LLC and eth-Wintermute.net.

In addition to the pig-slaughtering scams, the alleged con artists are also accused of using a technique known as the “Advance Fee Scheme,” in which they demand substantial sums of money to process fictitious withdrawals from their fraudulent websites. If the target falls for it, the con artist not only makes off with the initial payment but also with a bonus slice, before immediately breaking off all communication.

It is important for consumers to be vigilant when it comes to cryptocurrency investment opportunities, as scams like these can be difficult to detect. The DFPI advises customers to proceed with the utmost caution when responding to any solicitation providing financial or investing services. It is always a good idea to confirm if a supplier of financial or investment services is authorized to operate in California before proceeding with any transactions.

The DFPI’s warning serves as a reminder that it is essential to do your due diligence before investing in cryptocurrency or any other financial product. It is important to research the company or individual offering the investment opportunity, as well as the investment itself. Be wary of investment opportunities that seem too good to be true, and check the credentials of any company or individual offering financial services. If you are unsure about an investment opportunity, it is always a good idea to seek the advice of a financial professional or seek guidance from a reputable organization like the DFPI. Overall, it is crucial to exercise caution and common sense when it comes to investing, as the potential risks can be significant.


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