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The Financial Conduct Authority (FCA), the UK's financial watchdog, claims to have 50 current investigations into cryptocurrency business operators, including criminal probes. The agency also revealed that it investigated 300 cases relating to unregulated crypto asset enterprises over the course of six months, from September 2021 to September 2022, noting that a number of those cases could be tied to fraudulent operations. The FCA also revealed that it has received 16,400 inquiries regarding potential crypto frauds, up 33% from the same period in 2020.

 Consumers reported 4,300 possible crypto frauds on the FCA's ScamSmart website over the six-month period ending in September last year. This greatly outnumbered the 1,600 reports for the next most common type of pension transfer fraud, according to the authority. Crypto fraud checks on the FCA's ScamSmart tool increased by 49% in the six months leading up to September 2021, according to FCA data.

 "When it comes to investing, consumers need to feel confident, and the data we've released today demonstrates how common frauds are. Before investing, make sure you know who you're dealing with, that they're FCA-approved, and that you've done your homework to understand the dangers involved "In a statement, FCA markets executive director Sarah Pritchard said. The FCA keeps track of some 250 companies that "appear to be engaged in crypto-asset activity that is not registered with the FCA for anti-money laundering purposes."

 While the FCA plays a limited role in crypto firm registration for anti-money laundering purposes, it has no authority over crypto assets. Unsuspecting customers have been enticed to invest in crypto tokens that have been released without due diligence.

 Cryptocurrencies' opaque nature also makes it difficult for regulators to utilise traditional enforcement tactics to decrease the risk of consumer harm. The FCA has already cautioned (via Investment Week) that its current toolset is less successful than traditional financial products in keeping the crypto market in check.

 Susannah Streeter, a senior investing and markets analyst at Hargreaves Lansdown, believes that tools like the watchdog's ScamSmart campaign can help educate customers about fraud strategies and safeguard them.

 "Rather than just flashing the warning lights about the number of people being enticed into unsafe crypto investments and frauds," Streeter told Reuters, "the financial watchdog is now being a lot stricter on banning dubious enterprises from entering the market."