Recently we have reported on many cases of fraudsters who clone sites in order to attract unsuspecting investors and take their money and how financial regulators all over the world try to warn the public against such scams. Up until now the fraudsters would either make up completely fictitious entities that simply had the façade of a financial services firm, or would mix and match fibs with real data, mimicking or trying to impersonate existing authorized entities in order to trick customers and even the financial watchdogs themselves.
However, it seems that the ongoing war between financial regulating authorities and scammers has moved to another level, as it is revealed by an announcement issued by the Commission de Surveillance du Secteur Financier (CSSF), which is the financial regulator in Luxembourg.
It seems that the new weapon used by fraudsters is to create websites of fictitious official regulators, who they claim are regulating them, in order to attract deposits from clients. As it is mentioned in the CSSF announcement, impostors have cloned its own website and created www.lfcota.org, which falsely claims to be the website of the “Luxembourg Futures Commodities Options Trading Authority”, which the crooks maintain that is the official regulatory authority for futures and options markets of the Grand Duchy of Luxembourg.
As CSSF clarifies however, this is a completely fictitious entity as there is no such authority in existence in the country. It appears that the entity behind this scheme, which claims to be authorized by the so called “IFCOTA”, is an entity named Luxembourg Futures Commodities Options Exchange, against which the CSSF is also warning the public.
This entity claims to be located at 104 Boulevard Royal, L-2449 Luxembourg and operates through the website www.lfcoex.lu, and boasts that it is supervised by the aforementioned imposter authority. In its warning the CSSF stresses that the so-called Luxembourg Futures Commodities Options Exchange has not been authorized to offer financial services in/or from Luxembourg and thus urges the public to avoid it.
Although after the CSSF announcement, the open account option on the suspect website has been deactivated, this is a small victory and no form of consolation. In fact, this new trend of actually cloning existing or creating fictitious regulators to hide behind is a very worrying new twist in the effort to combat fraudsters in the online retail financial services industry and its bound to render the work of regulators globally even more difficult and challenging.
Perhaps a glimpse of hope could come if brokers themselves would understand how such mal-practices seriously undermine their credibility and trustworthiness and joined in the war against scammers more decisively and forcible, especially in the cases of jurisdictions in the less developed world, where the regulatory framework and the local financial watchdogs are much weaker or even none-existent.
George Milios is the founder of onlineforextrading.net, the binary options and forex news portal which is dedicated to providing you with all the information you need to successfully trade.