A finance regulator in the Canadian province of New Brunswick has warned residents about investing in a so-called "cryptocurrency bank" and its associated token.
In a March 5 statement, representatives from the Financial and Consumer Services Commission (FCSC) sounded the alarm about Bitcoin-bank.io, which according to its website promises a daily return on deposits through the use of a "BTCB" token. The site notably restricts the days on which the token in question can be bought or sold, stating that the first such "selling day" isn't until April 23.
According to the FCSC, the Bitcoin-bank offering is illegal.
"The commission took a close look at the website after becoming aware the cryptobank was advertising its investment opportunities on a Canadian online classified site," the regulator said in a statement. "Since it is not registered to trade in, or advise on, securities or derivatives in New Brunswick, it is illegal for Bitcoin-bank.io to carry out these activities in the province."
Additionally, a claimed California address is fake, the commission said upon investigating the location, and that some of the marketing materials distributed by promoters contain fictitious information as well.
"The review also revealed that many of the photographs accompanying team profiles on the website had been taken from other sites with fake names attached, and that content had been copied from other websites," the FCSC said.
The alleged cryptocurrency scam is the latest to take shape in Canada, which has seen a number of schemes solicit investors in recent months.
Last year, Canadian police issued a warning over a bitcoin tax scam, where fraudsters claiming to be part of the nation's Revenue Agency threatened some 40 victims with jail time for unpaid taxes. Those victims were told to withdraw bitcoin from a bitcoin ATM and send the funds to the scammers, and police estimated that the victims sent 340,000 Canadian dollars ($267,000).
It's not clear if the commission will take any further action against Bitcoin-bank.io. In its message, the FCSC advised would-be investors to do their homework before putting their money into anything, concluding:
"Becoming an informed investor is the best way to protect your money. Informed investors don't leave it to chance."
New Brunswick legislative assembly building image via Shutterstock