Details of this case study also featured in a partnership between CEL Solicitors and Bauer Media.
Robert Kitchen found himself the target of a complex crypto investment scam when fraudsters impersonated an investment platform that he had used for some time and demanded extortionate fees to withdraw his money.
Mr Kitchen opened an account with the trading platform AnalystQ in the hopes of investing in his future. Some time later, after seeing little in the way of returns, he decided to stop trading and close his account and thought little else of it.
A few months later, Mr Kitchen was approached by a person claiming to work for AnalystQ who told him that his wallet was still active and had been accruing more and more profit and was now worth £16,000.
They then claimed that Mr Kitchen’s wallet had now gone “cold” and that in order to withdraw his earnings he would need to reactivate it, however, to do so he would need to make a series of payments using Ibinex, a platform for buying and selling cryptocurrency.
Mr Kitchen was advised to make two groups of payments which were initially started comparatively small. The second payment was intended to bridge a connection between the previous “cold” wallet, and the new active wallet. He was then told that a further £3,000 was required to pay for the tax on his account.
After paying this fee, everything appeared to be in order once again. It was only a few months later that Mr Kitchens realised that some of the funds deposited were in the work account. When he enquired about this his account manager claimed that he would need to pay even more money to release his funds.
This push for more money was the final straw in causing Mr Kitchens to understand that this had all been a scam. From here he stopped all contact and reported the incident to his bank.
Getting money back from the scam
After reporting the incident to his bank Mr Kitchen was told that there was nothing that they could or would do to help him.
They also denied any fault in helping to prevent the scam despite knowing that Mr Kitchen’s payments were irregular and going to a crypto exchange that he had never previously used.
Due to their refusal to help, Mr Kitchens then reached out to CEL Solicitors for help and guidance.
Our dedicated fraud department examined his case and we were able to recover the full £8,000 lost, plus additional interest, resulting in a total of over £9,000.
James Crossley, the Fraud Expert Paralegal who handled Mr Kitchen’s case offers advice on avoiding crypto investment scams:
“Fraudsters are incredibly creative at finding new ways to trick and deceive their targets. Not enough generally, is known about cryptocurrency and scammers will use gaps in people’s knowledge to make white lies that make sense.
No investment company that manages your money for you will act on your behalf without a contract. In the UK to invest other people’s money for them, companies must be regulated by the FCA – you can check if a company is registered on the FCA’s website.
No legitimate investment broker or investment account manager will demand payment via cryptocurrency – cryptocurrency is harder to trace and easier to hide, it is unregulated. Real investment companies will only take investment in currency, they won’t accept crypto.”
