Australia Takes Action Against Massive Crypto Scam Network

By: Eliza Bennet

In a significant crackdown on fraudulent activities, the Australian Securities and Investments Commission (ASIC) has successfully shut down 95 companies associated with crypto and romance scams, which have resulted in global losses exceeding $35 million. The Federal Court of Australia approved ASIC's request to wind up these entities, which were mainly operating under misleading pretenses. These companies were found to be part of a scam network linked to "pig butchering," a malicious fraud model that combines deceptive crypto investments with emotional manipulation to victimize individuals financially and emotionally.

Most of the companies implicated had been registered using fictitious information, promoting fake ventures in cryptocurrencies, foreign exchanges, and commodities. They lured victims with legitimate-looking businesses through professional websites and forged corporate identities, effectively gaining the trust of unsuspecting investors. ASIC Deputy Chair Sarah Court emphasized the necessity of the court's intervention to mitigate further harm to consumers, highlighting the complexity of these scams, which were designed to obscure their true fraudulent nature.

ASIC has been actively combating online fraud, dismantling over 130 fraudulent websites weekly. However, the persistence of scams remains comparable to a "hydra," as new scams continually emerge even as previous ones are dismantled. To manage the liquidation process, Catherine Conneely and Thomas Birch from Cor Cordis have been appointed as joint liquidators, handling claims from affected victims spanning 14 countries, including the United States, India, and France.

This development showcases the ongoing challenge regulatory bodies face in protecting consumers in the volatile crypto landscape. Although ASIC's actions have curbed a significant threat, Court warns that vigilance remains vital as the risk of scams and identity theft continues to loom large. The court documents revealed limited assets among the dismantled companies, underscoring the complexity of recouping the millions lost by victims.