One-quarter of suspected frauds reviewed by the French financial ombudsman last year involved crypto investment schemes, according to a report published Wednesday.
The figure, a sharp rise from the 6% reported in 2020, suggests the sector is overtaking more traditional foreign exchange scams among the issues that get referred to public prosecutors, the report by Marielle Cohen-Branche said.
French crypto investors were also warned they wouldn’t be able to complain about providers that aren’t registered with France's national financial markets authority, the AMF.
“The ombudsman is only able to act if the professional has actively solicited the investor in France,” the report said, noting the emergence of a “new type of dispute concerning crypto assets.”
Under French law, crypto providers that want to sell in France must register with the AMF, which checks governance and compliance with anti-money laundering norms.
But French clients who on their own initiative seek out foreign crypto providers might be left without any redress if there’s a problem, the ombudsman pointed out.
Cohen-Branche, who works independently at AMF, is responsible for mediating disputes citizens have with financial intermediaries such as brokers or investment managers in cases where no criminal behavior is suspected.
Read more: 5 Social Media Crypto Scams to Avoid
DISCLOSURE
Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2023, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.