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BBB is warning about a new cryptocurrency scam targeting investors. The Nova Scotia, Canada Securities Commission sent out a press release alerting investors that SBlock-Trade and SblockTrade.Tech are not registered to trade in securities or derivatives in the province where they claim to be located.
SBlock-Trade alleges to be an online investment platform for forex and cryptocurrencies. SBlock-Trade claims to be based out of the “City of Nova Scotia” in Canada (which does not exist; Nova Scotia is a province). It also claims to have locations in both the United Kingdom and Bogota, Colombia.
According to the Commission, SBlock-Trade is soliciting investors to open trading accounts on its platform and encourages them to open Bitcoin accounts. The company alleges to have made 187 per cent on investments within 60 days and claims to offer significant returns of 30-50 per cent within the first week of investing. BBB warns investors to be suspicious of anyone who makes guarantees that an investment will perform a certain way.
It is important to recognize the red flags and exercise caution when dealing with unregistered firms. In many places, it is illegal to solicit investments without registering with the commission and complying with local securities laws.
If people have had contact with SBlock-Trade or have been approached with an investment opportunity they believe may be fraudulent, they are asked to report it to the Canadian Securities Administrators.
In Canada, to see if a company or person is registered, visit the Canadian Securities Administrators.
In the United States, most brokers and dealers must register with the Securities and Exchange Commission and join a "self-regulatory organization," or SRO. See the SEC's tips on avoiding fraud.
If you are contemplating a crypto-related stock investment, here are some tips to help you steer clear of scams:
- Do not say "yes" to cryptocurrency stock purchases from an aggressive cold caller, even if the claims sound plausible, particularly if the recommended stocks are very low-priced. Don't feel guilty about hanging up. Not answering at all, or putting down the phone, are generally the best and safest responses to a cold caller or anyone aggressively pitching low-priced stocks or other investment opportunities.
- Be suspicious of anyone who makes guarantees that an investment will perform a certain way or makes pushy sales pitches that encourage you to “act now.”
- Be wary of stocks with huge spikes in price: this could signal potential manipulation or fraud.
- Know where the stock trades and pay attention to any cautions associated with the stock.
For more information on cryptocurrency, and how to avoid falling for a cryptocurrency scam, take a look at the BBB's cryptocurrency tips.
