FINANCE - WEALTH MANAGEMENT

Belgian regulator

Henri and Bettel, “stars” of the same scam



“SPECIAL FEATURE: Xavier Bettel’s latest investment has experts in awe and big banks in terror,” reads this headline. It’s a scam. Screenshot: Maison Moderne

“SPECIAL FEATURE: Xavier Bettel’s latest investment has experts in awe and big banks in terror,” reads this headline. It’s a scam. Screenshot: Maison Moderne

Grand Duke Henri and Prime Minister Xavier Bettel have given two exclusive interviews to Le Quotidien about an investment scam that has been causing panic—a scam that the CSSF’s Belgian equivalent warned about over a year ago.

In an interview conducted by RTL Lëtzebuerg news anchor Mariette Zenners, the Grand Duke explains that he is inviting Luxembourgers to subscribe to the La Formule Française trading robot, which would allow them to “become millionaires in three or four months.” “I am happy to have tried it because it was literally the fastest way to make money immediately,” the head of state said. The text assures readers that the likes of Richard Branson, Elon Musk and Bill Gates are already happily taking advantage of the product. There’s a Xavier Bettel version of the interview too.

None of it is true, of course… swindlers have been trying to take advantage of internet users and relieve them of a few hundred or thousand euros. RTL issued a denial on its website on 12 July. The court said it had reported these campaigns to Govcert.lu and Facebook, where they were mainly broadcast.

An alert launched a year ago

The La Formule Française scam has been running since April 2018. Clicking on the links in the ad [which we chose not to add to this article] is not a good idea. Some people on the internet claim that the scammers are from Israel; our attempts to follow leads came to a halt in Bulgaria.

A year ago, on 17 September 2020, the Belgian equivalent of the CSSF, the FSMA, issued an alert in response to the scam. Like the Belgian regulator, the French Financial Markets Authority maintains a list of cryptocurrency-related scams.

As of last week, the 6,750 crypto-currencies listed on CoinMarketCap had a valuation of $1.9trn, of which bitcoin is worth $809b and ethereum $351b. Scammers usually take advantage of the volatility of one of the two currencies to make big gains in a short time. Others, more discreet and using a much more complex formula, offer more exotic currencies that usually have a flying start in terms of potential returns before collapsing like soufflés taken out of the oven too soon.

Dos and don’ts

The FSMA has posted some advice for avoiding scammers, including making sure that the company behind the investment is mentioned; checking for a licence to do with the firm’s services or financial regulators; never subscribing to an offer by telephone; and more. Finally, they recommend, if you have a problem with your account then contact your bank.

NFTs, a new playground

Scammers are hurting those who are doing their best to play by the rules. In its latest post, Scorechain, a Luxembourg start-up specialising in KYC and anti-money laundering for cryptos, reported that the two platforms with a foot in Luxembourg, BitFlyer and Bitstamp, are in the top five virtual asset service providers, a new classification by the CSSF.

The La Formule Française scam is no longer the latest one to be dreamt up by scammers. As The Verge reported on Wednesday, they have invaded the new trendy field of NFTs, virtual art objects. There is an added difficulty here in being safe, however: because these objects are housed on a blockchain, they can be transferred to crooks without any central, regulated intermediary. One of the new charms of digital ledgers…

This article was originally published in Paperjam. It has been translated and edited for Delano.