The
Financial Markets Authority (FMA) has issued an alert about a rising
cryptocurrency investment scam targeting social media users through YouTube
channels and messaging platforms.

FMA Warns of YouTube
Crypto Investment Scam

The
fraudsters operate by creating YouTube channels offering cryptocurrency trading
advice and luring viewers into private WhatsApp or Telegram groups with
promises of investment tips and prizes. Once engaged, scammers pose as
investment experts and direct victims to fraudulent trading platforms that
mimic legitimate cryptocurrency exchanges.

The
operation follows a calculated pattern where scammers first encourage small
investments to build trust. Victims are then shown fabricated profits to entice
larger investments. When users attempt to withdraw funds, they are met with
demands for additional fees, though no money is ever released.

The FMA has
identified over 40 suspicious trading platforms, including bi-investments.com,
phoenix-trades.com, and bricsinvestlimited.com. These websites are designed to
appear legitimate but are operated by scammers and
their full list can be found here.

Protection Measures

The
authority advises investors to:

• Verify
  trading platforms through the Financial Service Provider Register
• Avoid
  engaging with unsolicited investment advice on social media
• Report
  suspicious activities to relevant platforms
• Contact
  banks immediately if funds have been transferred.

The FMA
advises anyone who suspects they’ve fallen victim to these scams to cease all contact with the scammers immediately, report the incidents to relevant
platforms, and contact their bank to attempt transaction reversals.

WhatsApp: A Growing Risk
for Financial Scams

Financial
scammers are increasingly turning to WhatsApp and similar messaging platforms
to target victims, as reported by Finance Magnates last month. These
fraudsters often use these platforms to promote unauthorized investment
schemes, luring retail investors with promises of high returns. The schemes
typically rely on direct contact through mobile messaging, making them highly
accessible to unsuspecting individuals.

A survey of
631 traders identified Telegram as the riskiest platform for trading scams,
with 60% of respondents reporting financial losses. WhatsApp followed closely
with a similar percentage of losses, while platforms like Facebook (56%),
Instagram (51.8%), and SMS (50%) also showed significant risks. X (formerly
Twitter) and LinkedIn were slightly safer but still concerning, with 43.7% and
45.4% of users reporting losses, respectively.

Fake Celebrity
Endorsements Fuel Fraud

The FMA
recently issued another warning about fraudulent investment schemes leveraging
fake celebrity endorsements. Announced in May, the regulator highlighted the
growing prevalence of social media ads promoting crypto and forex investments
with fabricated celebrity endorsements. These scams often feature fake news
articles that appear to originate from reputable New Zealand media outlets and
use local celebrity images to gain credibility.

In March,
the FMA also cautioned against a clone scam impersonating BTSWE, a legitimate
cryptocurrency exchange in New Zealand. Fraudsters masquerading as BTSWE
representatives contacted consumers, falsely promising to recover funds lost in
unsuccessful investments. These impersonation schemes further underline the
risks posed by scams exploiting the trust associated with recognized platforms
and individuals.