Binance crypto exchange has released its own perspective of how crypto scam organizations operate.
The report released by Binance gives hint on how crypto scams try to look genuine so that they can capture as many victims as possible.
The report, released on June 30, was a study of various crypto scams that promised huge returns on investment. The study was not limited to crypto scams but also forex, CFDs and binary options.
Binance was prompted to do the study towards the end of June after some residents in Winnipeg, Canada were scammed.
Scams often look real
Regulatory bodies usually enact laws to frustrate scam organizations but this does not usually work out because the scam organizations come well prepared, disguising themselves as different entities with dissimilar products and services. Sometimes, they render crypto products and later on, forex or CFDs in different cities or after some period.
Scam organizations also make their victims think they are genuine by faking legal documents that are related to what consumers in the investment they represent hope to see. Sometimes, they bring up more of these fake documents when they feel their victims have started to suspect them so that they can be discouraged from reporting to the appropriate quarters for investigation.
According to the study done by Binance Sentry, it is sometimes difficult to catch these scam organizations early. Binance Sentry stated the reason as follows:
“Moreover, given the transnational nature of many of these organizations, their victims are often situated all over the world, living in jurisdictions that are different from the pseudo-services to which they fall victim of. As one may expect, this not only results in an increased level of difficulty for law enforcement investigations but also complicates the process of establishing connections between victims.”