Home Cryptocurrencies News ‘I started with a £190 bet on cryptocurrency – but ended up losing £230k’

‘I started with a £190 bet on cryptocurrency – but ended up losing £230k’

‘I started with a £190 bet on cryptocurrency – but ended up losing £230k’

Has a company treated you unfairly? Our consumer champion, Katie Morley, is here to help. For how to contact her click here.  

Dear Katie,

I have just been through the most difficult few years of my life. I thought I was through the other side, but then I fell for a scam that has left me beside myself with shame.

After years of unhappy marriage I split from my abusive ex-husband, my father died, and then without warning, my sister died. She had been living in my parents’ house and it was in a squalid state. I had to sort it all out. Due to the stress of it all, I had to stop work in October last year. I finally sold the house in November. Last Christmas was extremely difficult.

In January I read an advert for home working on the website of a national tabloid newspaper. It turned out to be cryptocurrency trading with an investment firm called Global1Exchange. I looked up some reviews online, which were mainly positive. Initially I invested £190, just to get a taste. I was assigned an account manager, who seemed very astute. I provided proof of my identity, as per money laundering regulations, including high-quality photographs of myself. The first thing Global1Exchange did after setting up my account was show me how to withdraw money. An identity check appeared on my account at ClearScore. Global1Exchange proceeded to call and email me.

Over a few weeks I invested £240,000. I made three withdrawals from my supposed account to the tune of £9,000. My investments seemed to be doing well. Then the entire sum was lost in one trade. Or so I was told. Then it dawned on me that my investments didn’t really exist. The whole thing had been a scam and I had lost everything. As soon as this became clear I contacted my bank, NatWest.

However it doesn’t seem interested in investigating and I’ve heard nothing. The scam has left me barely able to sleep. I feel physically ill when I wake up in the morning, and I have withdrawn from most social contact.

– Anon

Dear Anon,

I was so worried reading your email that I felt the need to phone you on my day off. We chatted for some time and you eventually revealed that around the time of the anniversary of your father’s death, you had attempted suicide. I was deeply saddened to hear this and promised to do my best to retrieve your lost money.

Having lured you in with a friendly advert, fake positive reviews, sophisticated website, legitimate credit checks and by sending you £9,000 in “profits”, this scam was exceptionally convincing. In fact, it was entirely fabricated and nothing to do with similar-sounding legitimate currency company, Global Exchange. I understand Global1Exchange is part of a £20m fraud being investigated by police.

I asked you to compile a timeline of events, including a spreadsheet of payments you had made to the fraudsters. Next to each transaction I asked you to write what NatWest had done to warn you it could be a scam. This revealed that despite promises on its website that it actively protects consumers in “high risk” scam situations, it did nothing of the sort.

You sent 13 five-figure payments within the space of weeks, totalling £240,000, yet you received no calls from NatWest. This was unacceptable, particularly as the bank has publicly signed a pledge that it will protect and reimburse innocent scam victims, especially the vulnerable, which I strongly believe you were.

I asked NatWest to refund you in full. It refused, explaining that you had sent the money to a cryptocurrency trading company called Coinbase. The Coinbase account was in your own name, it said. This was news to you and me both. You needed to take up your complaint with Coinbase first, said Natwest.

Needing to piece together what had occurred, I focused my attention on Coinbase. You said you had never knowingly set up an account with it, meaning the fraudsters must have done it using your details. Initially Coinbase in America refused to discuss your account. I kicked up a stink, leading to its UK team willingly assisting. I established there was a Coinbase account set up in your name, but you had not paid into it a single penny from your NatWest account. Conversely, your Coinbase account had paid your NatWest account £2,800 of the “profits” which you thought had come from Global1Exchange. I was stunned.

Then Coinbase raised doubts about the legitimacy of your story and suggested I might be the one being duped by you. I was quick to slap this down, as I was sure you were an innocent victim. Something was amiss, but I felt there had to be another explanation. If your £240,000 wasn’t sent to Coinbase, then where did you send it? You finally managed to retrieve your online transaction history. Against each payment was a code showing where the money went. Around £180,000 was sent to a smaller cryptocurrency company called Coinpass. The rest was sent to another trading firm called CB Live.

NatWest had misinterpreted these codes as Coinbase and hadn’t bothered to check them. It misinformed us both and sent me on a wild-goose chase after your money.

By this point I was spitting feathers. My investigation had descended into a farce as a result of incompetence I have rarely seen from a reputable institution. Aware it had messed up, NatWest told me your case had been reopened. There was still hope. But then it told me it couldn’t refund the money because your details had passed through Coinpass’s “know your customer” security processes. I told NatWest it was talking utter rubbish. Under its anti-fraud code there are no exemptions for cryptocurrency wallets or “kyc” security processes. This was just another pathetic excuse.

Then, in a highly unusual move, it provided me with the personal phone number of Coinpass’s senior personnel, suggesting I pursue it instead. Within minutes of the call I realised this was another dead end. This time Coinpass confirmed your money had landed in an account set up in your name, before being quickly moved elsewhere. However, it is a tiny company which couldn’t afford to reimburse you in a month of Sundays.

All these twists and turns were doing you no good. You were on the edge. I made your case to NatWest again. It came back and admitted what it should have done from the start: that it failed to honour its public fraud pledge by protecting you from the scam. Even one phone call asking pertinent questions such as what is the company’s Financial Conduct Authority registration number might have made you see it was a phoney.

Nearly two months after my involvement, NatWest still insists you should have been more careful with your money. But now, finally, it accepts part of the blame for what happened. It has refunded £114,673, which is half the money you lost, plus £500 to say sorry for the sloppy complaint handling. To recoup the remainder I’m afraid you will have to go via the Financial Ombudsman. I will help you do this.

NatWest denies this, but I think it dug its heels in here because your claim is unusually large. I have seen it fully reimburse smaller but less deserving cases without a fuss.

If it isn’t prepared to apply its anti-fraud pledge to all cases equally, then it ought to withdraw from it. Customers who have been fleeced don’t deserve to be given false hope. They need adequate protection from harm before it is too late. We cannot underestimate what a frightening plague fraud is on our most vulnerable members of society. It is high time the banks stuck to their promises and got a proper handle on it.

The full Katie Morley Investigates column will appear in print every Saturday and Sunday. You can get an early taste every Friday at 12:00


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