The Manitoba Securities Commission (MSC) is warning investors about a crypto exchange that claims to be based in the Netherlands and operating from Churchill, Man.
The MSC issued a warning about CrypTrade24, which the regulator said is promising investors huge returns on investment (ROI) within a short period of time.
“A 200% ROI in 20 days is a major red flag for fraud,” said Jason Roy, senior investigator with the MSC.
“Not to mention, the address had me do a double take.”
The MSC found that the firm’s claimed address is an unoccupied bungalow owned by the provincial government that is occasionally used by government staff travelling to Churchill for work.
“They have never heard of CrypTrade24, and no such company, or any other company, is operating from that address,” the regulator said.
The MSC also noted that the firm has never been registered to trade securities in Manitoba, and that it’s not registered with the Dutch Authority for the Financial Markets, either.
The British Columbia Securities Commission has also issued an investor alert about the company.
“I’ve seen many offshore trading firms use fictitious addresses, including a Winnipeg parking lot,” Roy said.
“Investors cannot rely on the look of a website to determine if it is legitimate, and they can’t rely on how nice the person on the other end of the phone is,” he said. “Investors need to make sure the person they are dealing with is registered to sell investments in Manitoba. It is the number one way to protect against investment fraud.”