The BC Securities Commission (BCSC) is urging British Columbians to protect themselves from crypto investment fraud by learning how to spot the signs of a scam.
Scammers are using the popularity and complexity of crypto assets to target vulnerable investors, particularly on social media. Recent BCSC research shows young adult investors in BC are more likely to turn to social media for investing advice and information, and that they are taking a more speculative and risky approach to investing with 18% holding only crypto.
For Fraud Prevention Month, the BCSC wants British Columbians to empower themselves with the information they need to spot crypto and other online investment scams.
As part of this effort, a new BCSC advertising campaign aims to show that not all crypto scams are obvious, but you can learn to spot the red flags. You can find out more about the campaign by visiting cryptoscams.ca.
Investors can protect themselves by recognizing the following characteristics of a crypto scam:
- Promises of “guaranteed” high returns on an investment: All investments have risk. Investors should question any investments that have a “guaranteed” return.
- Complicated jargon and language that’s difficult to understand: Scammers often exploit the mystique of complex new technologies, like blockchain or artificial intelligence, to project an image of expertise and authority.
- Unregistered salesperson: Many investment frauds involve individuals or firms that aren’t registered to buy or sell investments. Always check AreTheyRegistered.ca before investing.
- Unsolicited offers: Be extremely cautious if you receive unsolicited communication over email, by phone, pop-up ads and videos on the Internet, or direct messages on social media.
- Pressure to buy: Scammers may try to create a false sense of urgency to take advantage of an investment “before it’s too late.” Take your time and research an investment opportunity, ask questions, and talk to a registered investment professional before making a decision.
You can also reduce your risk when buying and selling crypto by using crypto trading platforms (also known as “cryptocurrency exchanges”) that are registered with Canadian securities regulators and by avoiding platforms that are banned.
Anyone who suspects they have been a victim of investment fraud should report it to the BCSC.
Report a Concern
If you have any concerns about a person or company offering an investment opportunity, please contact BCSC Contact Centre at 604-899-6854 or 1-800-373-6393, or through email at [email protected]. You can also file a complaint or submit a tip using the BCSC’s online complaint form.
InvestRight.org is the BC Securities Commission’s investor education website. Subscribe to receive email updates from BCSC InvestRight.
