In a recent development, Australia’s financial regulator, the Australian Securities and Investments Commission (ASIC), has taken action against 95 companies involved in crypto and romance scams. These companies were found to have operated under false pretenses, utilizing fake details and misleading consumers into believing they were offering legitimate services. The firms were part of a larger scam network known as “pig butchering,” which combines false promises of crypto investments with emotional manipulation.
The Federal Court approved ASIC’s request to dissolve these entities due to their misconduct and fake registrations. The court determined that the companies lacked proper governance and posed a serious risk to consumers. Many of these companies were found to be connected to suspicious platforms promoting fake investment opportunities in crypto, foreign exchange, and commodities. Victims were deceived into thinking they were engaging with reputable businesses through professional-looking websites and fake corporate identities.
ASIC Deputy Chair Sarah Court emphasized the importance of the court’s decision in preventing further harm from these scams. She highlighted the sophisticated tactics employed by the individuals behind these fraudulent activities, noting that they create complex setups to deceive victims and gain their trust. Despite ASIC’s ongoing efforts to combat online fraud, new scams continue to emerge, with Court likening them to a “hydra” that quickly replaces shut down operations.
In response to the court’s decision, Catherine Conneely and Thomas Birch from Cor Cordis have been appointed as joint liquidators. Nearly 1,500 claims have been submitted by victims, with losses exceeding $35 million across 14 countries, including the United States, Australia, India, Ghana, and France. However, the provisional liquidators discovered that out of the 95 companies targeted, only three have assets totaling $33,018, while seven companies have liabilities amounting to $38,689,419.
The latest Alpha Market Report highlights the ongoing battle against online scams and the significant financial losses incurred by victims worldwide. The report underscores the need for increased vigilance among consumers to protect themselves from falling prey to fraudulent schemes. It also serves as a reminder of the persistent nature of online scams, with new ones cropping up as quickly as they are shut down. Despite these challenges, ASIC remains committed to combating financial fraud and safeguarding consumers from deceptive practices in the digital realm.
