New Zealand’s regulator reports jump in investment scams in the 2022 fiscal year
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The New Zealand financial markets regulating, the Financial Markets Authority (FMA), has reported a jump in the number of investment scams reported in the recent financial year that ended in June last year. The regulator noted that 111 investment scam cases were reported during the financial period, which was a 17% gain from the 95 cases reported during the previous year.
New Zealand’s FMA reports jump in investment scams in 2022
The FMA noted that the scam cases reported during the period included fraudulent schemes, unregistered businesses, and a fake regulatory entity that impersonated the FMA. The FMA gave a breakdown of these cases during the 2022 Annual report released earlier this week.
The report has also mentioned that the scam warnings made by the regulator had jumped significantly year-over-year from the 83 cases reported in 2020. The FMA noted that complaints about investment scams had increased since the COVID-19 pandemic. Most scams were now related to fake websites, social media scams, and investment hybrid scams.
The FMA published the 2022 Ease of Doing Business Survey, that involved 162 stakeholders across the industry. The survey results showed that 78% of the stakeholders agreed to the FMA imposing a strong enforcement action to discourage industry misconduct. A similar survey was done in 2020 and 2021, where 71% and 78% of stakeholders, respectively, supported enforcement action.
They noted that the reason why more industry stakeholders were calling for more enforcement action in 2022 could be attributed to individual cases or outcomes. However, the regulatory body is still seeking new ways of promoting its enforcement activity to ensure there is no misconduct.
The role played by New Zealand’s FMA to regulate crypto
The FMA has conducted several enforcement actions in the recent months. Towards the end of December, the regulatory body filed a civil lawsuit against the local subsidiary of the company known as Tiger Brokers. According to the FMA, Tiger Brokers allegedly breached provisions on anti-money laundering and counter-terrorism financing. The FMA was seeking a penalty of NZ$900,000 from Tiger brokers.
During the same month, the FMA warned against a fraudster promoting himself as one of the clerks at the regulatory body. The imposer was cold-calling customers with the goal of soliciting personal information to scam victims.
In December last year, the regulator also released two alerts of crypto scams being conducted by the Bay Exchange and Krypto Security. The regulator noted that Bay Exchange did not have a license to offer financial services to investors in New Zealand. On the other hand, Krypto Security impersonated officials from the regulatory body to extort clients.
