UK Financial Regulator Warns Investors About ‘Clone Firm’
The U.K. Financial Conduct Authority has warned investors about a crypto ‘clone’ company, which impersonates an authorized and registered firm.
The U.K. Financial Conduct Authority (FCA) has warned investors about a so-called “clone’ company of investment firm Fair Oaks Capital Ltd., in a statement published Aug. 7. Clone firms are companies that carry out business activities under the pretense that they are a firm registered by the FCA.
Almost all legal entities involved in financial services in the U.K. must be authorized or registered by the FCA. In the statement, the FCA outlines a fraudulent company targeting people in the U.K. using registration data of firms authorized by the regulator. The clone, Fair Oaks Crypto, allegedly aims to hoodwink potential scam victims by claiming that they represent Fair Oaks Capital.
The FCA provided the contact details of the clone firm, so that potential investors or clients would know to avoid it. The British regulatory agency also suggested that investors check the Financial Services Register before dealing with a firm in order to ensure it is legitimate and operating legally.
In May, the FCA opened 24 investigations into cryptocurrency businesses over financial regulatory compliance in order to “determine whether they might be carrying on regulated activities that require FCA authorization.”
Generally, the FCA has demonstrated a positive regulatory approach towards cryptocurrencies. Recently, it announced the creation of a global initiative called Global Financial Innovation Network (GFIN) to improve collaboration between regulators and companies on fintech innovations like blockchain. GFIN aims to consult on various topics, including the regulation of securities and Initial Coin Offerings (ICO).
In March, the FCA launched a cryptocurrency task force in collaboration with the Bank of England in order to explore ways to regulate and support expanding crypto technologies. Shortly before, the regulator introduced a global fintech regulatory sandbox, that allows for innovative fintech development without requiring a full, strict regulatory process for testing.
Last month, the Big Innovation Centre, DAG Global, and Deep Knowledge Analytics released a report, that shows that the U.K. has the institutional and technological resources needed to become a leader in the crypto economic ecosystem within the next few years.
While the study considers the blockchain sector to be in the early stages of development globally, it still finds support at the governmental level. U.K. housing minister Eddie Hughes called on the government to prioritize the technology’s development in order to “enable social freedom, to increase efficiency, and to rebuild societal trust.”