DFSA Warns of Fake Letters Seeking Crypto and Blockchain Payments

The Dubai Financial Services Authority (DFSA) has warned the public about a scam involving communications that impersonate the regulator and falsely claim to process, verify, settle or release funds linked to blockchain, cryptocurrency and DeFi transactions.

The fraudulent letters and emails use the DFSA’s name and logo and may refer to “blockchain settlement blocks,” “segregated wallets,” verification requirements or compliance protocols. Recipients are then allegedly asked to make additional payments or deposits before their funds can be released.

DFSA Says Communications Are Fraudulent

The DFSA made clear that the communications were not issued by the regulator. It said the DFSA does not process, hold, verify, settle or release client funds.

The regulator also does not require consumers to make deposits, verification payments, settlement payments or other fees to release investment proceeds, cryptocurrency holdings or blockchain-related assets.

The DFSA said it does not issue letters concerning customer funds through blockchain settlement systems and does not operate customer wallets, settlement blocks or cryptocurrency custody arrangements.

The regulator has published a copy of the fake letter involved in the scam. Read the DFSA fake letter

Similar Regulator Impersonation Scams

The warning is not an isolated example of scammers misusing financial regulators’ identities. Australia’s ASIC has also warned about scams in which fraudsters impersonate the regulator and request payments to release funds or assets. ASIC said it does not collect payments to enable the release of funds and will not require or accept crypto payments for that purpose.

ASIC has separately warned that scammers may use fake regulator websites, logos, emails and social-media accounts to make fraudulent investment communications appear legitimate.

These cases highlight a common risk for investors: a regulator’s name, logo or official-looking document does not by itself prove that a communication is genuine.

Investors Should Verify Before Paying

The DFSA strongly advises consumers not to respond to the fraudulent communications, send money or provide personal, banking, cryptocurrency wallet or identification information.

Investors should be especially cautious when someone claims that an additional “verification fee,” “settlement payment” or “release fee” is required to recover or access investment funds.

For Forex and CFD investors, regulatory checks should also go beyond the broker’s brand name. Before opening an account, investors should verify the exact legal entity, regulator, licence number, authorised activities and the entity named in the client agreement through the relevant regulator’s official register.

For more regulatory warnings, broker checks and investment scam investigations, follow our  [Broker Reviews] and [Scam Alerts] for further updates.

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