Latvian Regulator and Cryptocurrency Fraud

The Republic of Latvia is a country located in Northern Europe and it regained its independence 29 years ago. Interestingly, Latvia joined the European Union in 2004, also the country is a member of the North Atlantic Treaty Organization (NATO). People should take into account that, Latvia is a full member of the Eurozone. The country located in the Baltic region of Northern Europe is home to around 2 million people. It is worth mentioning that, Latvia has the potential to develop the crypto industry. On October 19, the country’s Financial and Capital Market Commission (FCMC) released information. People should pay attention to this warning. It is worth noting that, Latvian regulator identified suspicious transactions as well as attempted fraud in the domestic cryptocurrency space.

Based on the information provided by FCMC, investors should pay attention, as cryptocurrencies operate in the infrastructure, that is currently characterized by lower regulation than in the financial and capital markets. 

People should take into account that, within the country, the issuance and circulation of cryptocurrencies are mostly unregulated. However, there are certain exceptions as well. Notably, certain types of investment services and contracts involving crypto that require a license from the FCMC. 

Let’s have a look at several details revealed by the Financial and Capital Market Commission. The Latvian regulator identified several details within the domestic cryptocurrency market. For example, online crypto adverts circulated by scammers may use names and images of famous people. Moreover, scammers may use the names of licensed companies. 

Cryptocurrency fraud and interesting details

Moreover, these ads often direct investors to slick websites. They should reveal their phone numbers to such websites. Importantly, many of the attempts to persuade investors to invest in fraudulent schemes happen over a phone call. 

Furthermore, scammers are trying to imitate licensed market participants, by appropriating legitimate firms’ registration numbers or contact details. This way they want to mislead investors. 

Interestingly, such so-called companies may offer a person to invest bonds, stocks, forex products, and cryptocurrencies. However, they are either not traded on exchanges or are worthless. Another option is that such investments may not exist at all. 

Importantly, in the absence of regulatory supervision, it is quite hard to cope with such cases. However, it is possible to cope with such risk factors. People who would like to invest but lack knowledge and experience can visit a bank or a licensed investment brokerage firm. According to the legislature, such service providers have to inform about possible risks. Investors should pay more attention to even minor details.