The Washington State Department of Financial Institutions (DFI), Securities Division received a complaint regarding Coinstoreproali.com, a website claiming to be a cryptocurrency trading platform.
The investor learned of Coinstoreproali.com from an individual via LinkedIn. Subsequently, the investor communicated with the individual through Whatsapp. The investor invested a total of approximately $700,000 through the Coinstoreproali website over a four month timespan. The investor withdrew funds from his retirement accounts, took out a home equity loan, and borrowed funds from family members to invest with Coinstoreproali in cryptocurrency. At one point, his account had a purported balance of $1,000,000.
The investor chose to withdraw some of his funds to repay his loans, as well as to pay the individual that had introduced him to Coinstoreproali. Coinstoreproali told the investor that he would need to pay a fee of 20% of his assets to withdraw his funds.
He paid the fee and again requested some of his funds be withdrawn. Coinstoreproali again required the investor to pay additional fees in the form of taxes. The investor paid the fee for the purported taxes.
The investor’s account was then placed in a holding pattern. Coinstoreproali contacted him and said he could pay an additional fee and join a “VIP channel” for priority processing of his withdrawal request. The investor again chose to pay the fee and joined the purported VIP channel. The investor’s account remains in a hold status, and is purportedly being reviewed. The investor has been unable to withdraw his funds.
These allegations have not been verified by DFI.
This appears to be what is commonly called and “Advance Fee Fraud.”
DFI urges consumers to exercise extreme caution before responding to any solicitation offering investment or financial services. Investment professionals need to be licensed with DFI to offer investments to Washington residents. In addition, most investment products sold need to be registered with DFI. To check the licensing status and to find out if there are any complaints against an investment professional or investment product, please visit FINRA Brokercheck or contact the Washington State Department of Financial Institutions, Securities Division at (360) 902-8760. If you live outside of Washington State, contact your state securities regulator.
If a consumer believes a person or company has violated state law or acted improperly regarding an investment product or service, they may file a formal complaint with the Securities Division (https://dfi.wa.gov/consumers/file-complaint/investor-complaint).
Additional Resources
Virtual Currency, Cryptocurrency, and Digital Assets Information for Consumers