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New Zealand Regulator Raises Scam Alert Over Three Companies

The country has listed three companies as potential scams, warning traders not to engage with them.


 

Three More Firms Added To The Scam Alert

Authorities in New Zealand have raised an alarm over possible cryptocurrency scams. The Finacial Markets Authority on Friday revealed that three firms had been added to a list of potential scams.

The affected companies include Zend Trade, Russ Horn and Cryptogain. The firms are now listed under the Warnings and Alerts category. The category was established by the regulator to assist investors in safeguarding their funds.

In a statement by the FMA, the operations by the listed entities show blatant characteristics of scammers. The regulator went on to recommend that residents should not invest anything in the companies.

CryptoGain raised suspicion after promising investors that they will get daily returns. A similar scheme was hatched by BitConnect. A glimpse at the exchange’s website shows they offer up to 2.6% daily returns. Furthermore, they provide mining packages meant for cloud services. These returns are very high and should naturally trigger concerns. Additionally, the cloud mining offer is yet to be registered in the US.

The FMA has also raised questions about the credibility of CryptoGain. The regulator suspects that the exchange might be operated as a front company. A look at the company's registration details, point to an entity called CryptoGainLimited. However, it has no relationship with CryptoGain.

The FMA further suspects that Russ Horn is behind the creation of Forex Equinox and Zend Trade. Notably, Russhorn.com and Forex Equinox aren't exactly scams that won't offer returns, the companies' claims appear to be highly exaggerated in the marketing ads for Russ forex trading platform. They provide a book that is shipped free of charge. The books contain alarming claims like how to beat forex trading systems in a legal manner.

A look at ForexEquinox.com, the platform alleges that it needs only a period of one month to double invested money.

The FMA classified Zend Trade on the scam list after it emerged that the platform did not return funds owned by clients to them. Zend claims that it can provide managed account services. In other words, the platform takes client money and trades on their behalf. Such a situation will definitely raise the attention of regulators. A report by the FMA states that Zend Trade is linked to Russ Horn.

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