ASIC Takes Action Against Crypto-Related Fraud
The Australian Securities and Investments Commission (ASIC), the country’s primary regulatory body for corporate affairs, has secured the Federal Court’s approval to dissolve 95 firms connected to potential crypto-related fraud and romance scams, often described as ‘pig butchering.’ This significant move, undertaken on equitable grounds, follows ASIC’s discovery that these companies were established based on misleading information.
Identifying Fraudulent Activities
According to ASIC Deputy Chair Sarah Court, the firms masqueraded as legitimate businesses while engaging in fraudulent activities aimed at scamming victims, as detailed in an announcement made on April 8. On April 4, Justice Angus Stewart provided a verdict that particularly identified a troubling trend in scam operations tied to pig butchering schemes, referencing an evaluation of misconduct involving 17 companies linked to romance scams.
“This ruling highlights the sophisticated deceit employed in these scams, where fraudsters cultivate fake relationships to lure victims into investing in bogus crypto or financial schemes.”
Evidence suggests that a considerable amount of this illicit activity is rooted in Southeast Asia.
Oversight and Impact on Investors
In the wake of the court’s decision, the companies are under the oversight of joint liquidators Catherine Conneely and Thomas Birch from Cor Cordis. The provisional liquidators have received nearly 1,500 claims from so-called ‘investors,’ amounting to over $35.8 million. These claims originate from individuals across 14 different nations, including Australia, the United States, Cameroon, and France, indicating a widespread impact of these scams.
Alarmingly, investigations revealed that merely three out of the 95 companies had any tangible assets, prompting a recommendation for the dissolution and deregistration of the remaining 92 firms.
Ongoing Efforts Against Online Scams
Moreover, ASIC continues its extensive efforts to combat online scams, reporting the removal of around 130 fraudulent websites weekly, which brings the total to over 10,000. This includes more than 7,200 fraudulent investment platform scams and 1,564 phishing schemes. Despite these proactive measures, ASIC cautions that the situation resembles a hydra—where as soon as one scam is dismantled, new ones emerge, stressing the persistent danger posed by scams and identity theft.
On a related note, Australia’s National Anti-Scam Centre recently disclosed a 26% drop in scam-related financial losses, amounting to $2 billion in 2024, along with a 17.8% decrease in overall scam reports, totaling 494,732.
