Fraud programs targeting crypto traders have spread to many parts of China after Beijing cracked down on the crypto and ICO markets a few years ago.

A dealer in China | illustration

Law enforcement agencies in Dezhou City, Shandong Province announced on July 3 that they had received a criminal complaint from a girl named L who had been defrauded of hundreds of thousands of yuan through an organized fraud scheme.

Ms. L. downloaded the “BNY MELLON” app at the beginning of June to trade coins, won some money and also successfully made two small withdrawals.

However, after Ms. L deposited a larger amount for further investments in the app, she was unable to withdraw funds from the platform, resulting in a total loss of 379,000 yuan (VND 1.35 billion).

Local media reports that cases similar to those of Ms. L. are becoming more common in China, with scammers using fake trading platforms to attack inexperienced traders.

Platforms always use small transactions to secure the victim’s initial trust before tricking them into depositing larger amounts and then expropriating them.

Plans like this have increased with the crypto boom in China and around the world over the past year.

The fact is that cryptocurrency transactions in China are not subject to any legal protection, investors are not prohibited, but are not strictly protected by law.

A similar scam was foiled by Jiangsu Province police in April this year with the arrest of 58 suspects in connection with staging live streams to attract gullible victims.

Scammers have invited investors to join the WeChat group, which offers exclusive live streams of hit and win crypto investment strategies. The group then invited investors to participate in a fake cryptocurrency trading platform that stole about 10 million yuan (VND 35.5 billion) from the victims.

If investors discover that their balance on the platform has dropped to zero and complain to customer service multiple times, they will be informed that the platform has been “hacked” and rest assured that the problem will be fixed.

Jiangsu police later discovered that the fraudulent platform was operating in a high-rise office building in Chengdu City, Sichuan Province. The platform actually did not participate in any cryptocurrency transactions, it only created transactions with fake numbers in the customer account.

When a customer account suffers a loss, the criminals simply take away the corresponding amount, while conversely the customer is profitable and wants to withdraw large amounts, they make it extremely difficult for the customer to charge too much, the message is attacked by hackers (poor hackers).

Bitcoin price, which has skyrocketed since last year, has brought many young investors into the market, bringing with it enormous personal financial risks, which has led China’s financial authorities to increase pressure on domestic trading activities from March this year. Most recently, the central bank asked commercial banks to ban all crypto-related transactions in order to limit investor participation in the market.

Thach Sanh

According to AZCoin News

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