UK police have warned investors to avoid Coscoin, a Washington-based AI-oriented crypto scheme after 78 victims in England reportedly lost £214,869 ($273,600).
Coscoin was created in 2015 and claims to be a “leading AI quantitative trading platform.” However, as reported by the BBC, police say the crypto firm appears to be a pyramid scheme that’s incentivizing users to recruit additional investors.
The North East Regional Organised Crime Unit reportedly estimates that 78 victims have lost an average of £2,900 each to Coscoin. In a post on X, the unit said, “When it comes to money, it might sound repetitive but, if it sounds too good to be true it probably is.”
The FCA flagged the firm on December 12, 2023, stating that it is not authorized by the watchdog and that investors should avoid Coscoin while being aware of any scams.
The Washington State Department of Financial Institutions also stated that Coscoin might be “A fraudulent cryptocurrency trading platform… engaged in fraud.”
Economic crime team leader Detective Inspector Paddy O’Keefe, said, “Criminals will also create scams promising to recover investments so please avoid any instances where you could be victim to further frauds linked to your original loss.”
Indeed, scammers can be seen on X (formally Twitter) utilizing a hashtag with the Coscoin name to promote a fake recovery service in an attempt to scam those who have already lost their funds.
One victim, who briefly worked as a Whatsapp admin for Coscoin, told the BBC that he quit his job at Nissan when Coscoin offered him a high salary. However, soon after, he began witnessing investors unable to withdraw their funds.
He said, “We were just used like puppets. They have painted a target on our backs and we were there to take the fall.”