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International regulator issues warning over Bitcoin platform used by Kiwis

International regulators are urging caution over a Bitcoin trading scheme used by New Zealanders. USI-Tech is based in the United Arab Emirates and operates online, offering investors returns of 1 per cent per day, plus a size of the investment returns of others they recruit to the platform.

A number of New Zealanders have put money into the scheme – one journalist said she invested an initial £1000 ($1900) upfront and another who did not want to be identified was investing thousands of dollars, charge to his credit card.

Now, British Columbia’s regulator has warned investors to take care using USI-Tech.

Despite offering a security, USI-Tech has not registered itself with a securities regulator in any jurisdiction it operates.

An Financial Markets Authority spokesman could not comment on USI-Tech specifically.

But he pointed to the regulator’s guidance, which says many overseas cryptocurrency exchanges are unregulated, operating online, with no connection to New Zealand.

“This makes it hard to find out who is offering, exchanging, buying or selling it. It also makes it unlikely you’ll recover your money if things do go wrong.  Using cryptocurrencies may make you a target for scammers or businesses selling high-risk investments.”

The FMA said people should research all investments thoroughly.

“Ask to see the product disclosure statement. Scammers rarely put things in writing, but almost all legitimate investments offered in New Zealand must have this document.”

Investors should also find out the legal name of the businesses they dealt with, should check they were regulated by the FMA and be wary if they were not.

“[If not] it is often impossible for us to help if things go wrong.”

USI-Tech has been approached for comment.

Source: https://www.stuff.co.nz/business/99976731/international-regulator-issues-warning-over-bitcoin-platform-used-by-kiwis

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