News2020.02.26 17:00

Lithuanians targeted by Cypriot investment scam – LRT Investigation 2020.02.26 17:00

LRT Investigation Team has revealed a financial scam targeting Lithuanians via a Cypriot Royal Forex LTD company.

Mindaugas Aušra from the LRT Investigation Team has recorded at least 10 cases of Lithuanian citizens losing money to the Cypriot Royal Forex LTD and its platform, GMO Trading. LRT is also aware of at least another 100 cases

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The invested money would disappear overnight and the clients would then be bombarded with calls urging them to borrow funds and transfer them into accounts overseas.

A source from the company’s call centre in Lithuania told LRT that all workers are aware that they’re scamming people. The source also said the company imitates investments.

Evidence gathered by LRT show that the call centre in Lithuania is connected to the Cyrpiot Royal Forex LTD via the same individual.

The scheme works in the following steps: an agent offers an investment to the client. The money is then transferred to a fake investment platform. The funds then move to a money laundering system, half of which is handed over to the call centre.

The callers then pressure, coerce and demand more money from the victims until no resources remain, and the scheme moves onto the next person.

Lithuanian law enforcement considers investment freud as organised crime. Its structure is usually split across five countries and is divided into two parts: call centres and money laundering groups. The two divisions of the operation share the proceeds.

Lithuania’s central bank has turned to the Cypriot law enforcement, and Lithuania’s criminal investigation unit is also conducting an investigation.

The central Bank of Lithuania admits chances of recovering the money are slim, according to LRT Investigation Team.

As the company operates under a Cypriot license, the Bank of Lithuania says it cannot restrict the activities of the company nor its subsidiaries in Lithuania.

Ilja Kremer, head of the company’s Lithuanian subsidiary, told LRT the company does not accept any responsibility for the lost funds as it only registers the clients.

Some clients have already received compensation payouts standing at around 10 percent of the money invested, he added.

Lithuanian banks registered over 230 investment fraud cases last year, and their clients lost around 2.3 million euros, according to figures from the Association of Lithuanian Banks.

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