Regulators Target Broker Clone Networks After 1,400 Fraud Domains Shut Down

Germany’s financial regulator BaFin, together with the Baden-Württemberg Cybercrime Centre, Europol and Bulgarian law enforcement, has intensified enforcement actions after dismantling more than 1,400 illegal trading domains used to impersonate licensed brokers and asset managers. The crackdown, part of Operation Heracles, revealed a coordinated network of fraudulent platforms built to mimic regulated investment firms, complete with cloned branding, fabricated licence data and AI-driven trading dashboards.

Investigators confirmed that these domains redirected investors to offshore call centres posing as portfolio managers. Victims were lured with promises of access to exclusive funds, derivatives products or index-linked returns. Many continued depositing funds for months, unaware that no regulated account existed and withdrawals were impossible.

Despite the shutdown of key domains, traffic records showed hundreds of thousands of attempted visits to the seized sites, indicating that investor recruitment channels remain active. Authorities warn that the core operators have not been detained and are rapidly reproducing mirror platforms under new domain structures.

BaFin has separately issued alerts on identity misuse, referencing cases where criminals falsely claimed affiliation with major firms such as Invesco. The regulator confirmed no licensed entity contacts investors via unsolicited email or messaging apps and cautioned that such communication is a primary indicator of fraud.

Europol has signalled that the scale of impersonation fraud now presents systemic risk to the financial sector, complicating due diligence and eroding public trust in licensed intermediaries. Regulatory bodies are preparing tighter measures on digital infrastructure monitoring, brand misuse reporting and faster cross-border takedown protocols.

Financial institutions are being urged to actively surveil digital channels for unauthorised use of their identities, issue immediate public clarifications when detected and coordinate directly with cybercrime units. As AI accelerates the replication of professional-grade fake platforms, regulators warn that broker identity abuse is now a frontline threat to market integrity, not only consumer protection.