Imagine an investment company has defrauded you, and you are seeking legal help to
fight for your rights. Instead of assistance, however, the law firm turns out to be fake, and you lose funds again. This scenario affected hundreds of retail
investors from Poland, who may have lost over PLN9 million (€2.1) in the
dishonest scheme.
The Warsaw regional
prosecutor’s office, along with the police central investigative bureau,
announced today (Thursday) that they have dismantled a gang of fraudsters
posing as law firms, offering their services to retail investors previously
cheated in the forex (FX) and cryptocurrency markets.
The
fraudsters contacted victims via the internet, through forums and social media
channels, responding to their requests for help to recover funds from dishonest
brokerage and crypto firms. However, they charged upfront commissions ranging
from five to ten per cent of the funds the investor wanted to recover.
In this
way, the scammers are said to have defrauded over €2 million from at least
several hundred people who were cheated for a second time. So far, the police
have managed to arrest 14 people on charges of fraud and attempted money
laundering.
The fake
law firms engaged in a series of bogus legal steps to recover these funds.
Investigators determined that the entire procedure was meant to convince the
victims that the firm was actively working to reclaim the money.
“In
reality, there was no real possibility of the victims recovering their
funds,” the Polish police commented in an official statement,
automatically translated by Google Translate. “The individuals employed at
the firm lacked legal education and were hired as telephone operators trained
to conduct conversations with clients to persuade them to invest money.”
Interestingly,
some of those arrested were already known to Polish law enforcement, as they
had been involved in crimes in the FX market in the past.
Documents and servers belonging to the fraudsters, secured by the police.
“Recovery Experts”
Scam: A Longstanding Ruse
As it turns
out, this fraudulent scheme is unfortunately more common than it might seem.
Finance Magnates had already pointed out in 2018 the “recovery experts”
who directed their services to those defrauded in financial markets, promising
help in recovering funds.
A similar
strategy was adopted in 2019 by fraudsters in Cyprus, who impersonated the
local supervisory commission CySEC . In messages sent to retail investors, they
claimed they could offer assistance in recovering funds if there were a
suspicion that the broker where they had deposited acted illegally.
“CySEC
would like to remind the public that it never sends unsolicited correspondence
to investors or members of the public, nor does it ever request any personal
data, financial or otherwise,” the regulator stated in its 2019
announcement.
Three years
ago, the Belgian Financial Services and Markets Authority (FSMA) also warned
against similar practices, writing about “recovery rooms” fraud
targeting citizens in the country.
Imagine an investment company has defrauded you, and you are seeking legal help to
fight for your rights. Instead of assistance, however, the law firm turns out to be fake, and you lose funds again. This scenario affected hundreds of retail
investors from Poland, who may have lost over PLN9 million (€2.1) in the
dishonest scheme.
The Warsaw regional
prosecutor’s office, along with the police central investigative bureau,
announced today (Thursday) that they have dismantled a gang of fraudsters
posing as law firms, offering their services to retail investors previously
cheated in the forex (FX) and cryptocurrency markets.
The
fraudsters contacted victims via the internet, through forums and social media
channels, responding to their requests for help to recover funds from dishonest
brokerage and crypto firms. However, they charged upfront commissions ranging
from five to ten per cent of the funds the investor wanted to recover.
In this
way, the scammers are said to have defrauded over €2 million from at least
several hundred people who were cheated for a second time. So far, the police
have managed to arrest 14 people on charges of fraud and attempted money
laundering.
The fake
law firms engaged in a series of bogus legal steps to recover these funds.
Investigators determined that the entire procedure was meant to convince the
victims that the firm was actively working to reclaim the money.
“In
reality, there was no real possibility of the victims recovering their
funds,” the Polish police commented in an official statement,
automatically translated by Google Translate. “The individuals employed at
the firm lacked legal education and were hired as telephone operators trained
to conduct conversations with clients to persuade them to invest money.”
Interestingly,
some of those arrested were already known to Polish law enforcement, as they
had been involved in crimes in the FX market in the past.
Documents and servers belonging to the fraudsters, secured by the police.
“Recovery Experts”
Scam: A Longstanding Ruse
As it turns
out, this fraudulent scheme is unfortunately more common than it might seem.
Finance Magnates had already pointed out in 2018 the “recovery experts”
who directed their services to those defrauded in financial markets, promising
help in recovering funds.
A similar
strategy was adopted in 2019 by fraudsters in Cyprus, who impersonated the
local supervisory commission CySEC . In messages sent to retail investors, they
claimed they could offer assistance in recovering funds if there were a
suspicion that the broker where they had deposited acted illegally.
“CySEC
would like to remind the public that it never sends unsolicited correspondence
to investors or members of the public, nor does it ever request any personal
data, financial or otherwise,” the regulator stated in its 2019
announcement.
Three years
ago, the Belgian Financial Services and Markets Authority (FSMA) also warned
against similar practices, writing about “recovery rooms” fraud
targeting citizens in the country.
