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2023-06-22 12:03 PM

Alert: FSCA Warns Public Against Unauthorised Crypto Investment Schemes

  • The Financial Sector Conduct Authority (FSCA) has issued a public warning against MultiFX Options and Digital Daily Return, two entities that are not authorized to provide financial products or services.
  • These entities have been soliciting crypto asset investments from the public using social media platforms, falsely using the name of Barry Silbert, founder and CEO of Digital Currency Group, to attract investors.
  • The FSCA urges the public to verify the authorization of any entity or individual offering financial products or services, and to understand the category of advice they are registered to provide, to avoid falling victim to poor financial advice or scams.
By William Dube

The Financial Sector Conduct Authority (FSCA) has issued a public warning against two unauthorised financial entities, MultiFX Options (MultiFX) and Digital Daily Return (DDR). The FSCA has cautioned the public to exercise caution when dealing with these entities, as they are not authorised to provide financial products or services, including selling investments or making recommendations.

According to the FSCA, MultiFX and DDR have been soliciting crypto asset investments from the public through various social media platforms. The entities have been using the name of prominent business leader Barry Silbert, founder and CEO of Digital Currency Group (DCG), to attract investors in an unauthorised manner. DCG is the parent company of Luno South Africa, a leading cryptocurrency exchange.

Luno has confirmed that Silbert does not invite members of the public to transfer funds for investment purposes, nor does he engage in any trading activities on behalf of the public. This misuse of Silbert’s name and reputation is a clear attempt to mislead potential investors and gain their trust under false pretences.

The FSCA has urged the public to always verify that an entity or individual is authorised by the FSCA to provide financial products and services, including giving recommendations about how to invest. This is a crucial step in ensuring that one’s investments are secure and managed by legitimate entities.

Furthermore, the FSCA has highlighted the importance of understanding the category of advice that a person or company is registered to provide. There have been instances where companies or individuals are registered to provide basic advice for a low-risk product, but then offer advice on far more complex and risky products. This can lead to investors receiving poor financial advice, which can have severe consequences.

The FSCA’s warning serves as a reminder of the importance of due diligence when it comes to investing. It is essential for potential investors to thoroughly research and verify the legitimacy of any financial entity or individual before entrusting them with their funds. This includes checking their registration and authorisation status with the relevant regulatory bodies, understanding the nature of the advice they are registered to provide, and being wary of any investment opportunities that seem too good to be true.

In the rapidly evolving world of finance and technology, it is more important than ever to stay informed and vigilant. The FSCA continues to work towards protecting the public from unauthorised and potentially harmful financial entities, and encourages individuals to report any suspicious activities.

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William Dube

William Dube is a finance and economic news expert with over 10 years of experience in economic anaylsis, financial product assessment and market analysis. With a numerous certificates from prestigious universities including but not limited to Yale University and the University of Pennyslivenia. William specializes in providing insightful news developments in South Africa and commentary on investment strategies, risk management, and global economic trends. You can contact him on william@rateweb.co.za