The Manitoba Securities Commission has issued a warning about a website that claims it operates out of Churchill and offers cryptocurrency trading, but is in fact a site “set up in order to steal money,” according to the provincial government agency.
The website, CrypTrade24, offers trading in cryptocurrencies such as bitcoin, and promises up to a 200 per cent return on investment within 20 days, the securities commission said in a news release Tuesday.
The website claims to have “collected the best from the business of investment under a single virtual roof.”
It turns out the physical location the company claimed as its Churchill address is actually a two-bedroom bungalow that a securities commission investigation found is owned by a Manitoba government department.
The house is currently unoccupied but is occasionally used as a residence for government staff travelling to the northern Manitoba town for work, the commission said, adding that no company is actually operating from the address.
“A 200 per cent ROI [return on investment] in 20 days is a major red flag for fraud,” Manitoba Securities Commission senior investigator Jason Roy said in Tuesday’s news release.
“Not to mention, the address had me do a double-take.”
Churchill is a beautiful place, Roy told CBC News. “It’s got whales and polar bears. But it’s probably not a place where someone would set up a cryptocurrency trading site. So we started looking into it.”
Following its investigation, the securities commission has issued an investor alert on CrypTrade24 and cryptrade24.com, which claims on its website that it is legally registered in the Netherlands and operating from the Churchill address.
“CrypTrade24 is not, and never has been, registered to trade in securities in Manitoba. Staff of the Dutch Authority for the Financial Markets (AFM) have confirmed the company is not registered in the Netherlands either,” the Manitoba commission said.
“I’ve seen many offshore trading firms use fictitious addresses, including a Winnipeg parking lot,” Roy said in the release.
“Investors cannot rely on the look of a website to determine if it is legitimate, and they can’t rely on how nice the person on the other end of the phone is.”
Roy said he’s not aware of any Manitobans losing money through the CrypTrade24 site, but he said the MSC is pre-emptively putting out an alert.
“It’s just a trading site that’s set up in order to steal money. Nothing more,” Roy said. “It just gives the appearance of a trading site.”
CrypTrade24 did not respond to a request for comment from CBC News.
The securities commission said to guard against fraud, investors need to make sure the person they are dealing with is registered to sell investments in Manitoba.
That can be done through the Canadian Securities Administrators website at aretheyregistered.ca.
The British Columbia Securities Commission has also issued an investor caution naming CrypTrade24.