Pakistan investigates Binance multi-million dollar crypto scam

According to reports, Pakistan’s Federal Bureau of Investigation (FIA) has issued an official notice to cryptocurrency exchange Binance in an effort to establish the connection of millions of cryptocurrency scams in the region.

The Pakistani government has launched a criminal investigation after receiving numerous complaints against an ongoing scam involving misleading investors into sending funds from Binance Wallet to an unknown third-party wallet. according to For local coverage, the FIA’s cybercrime unit has release An order of attendance was issued to Hamza Khan, managing director of Binance Pakistan, to identify the exchange’s link to a “fraudulent online investment mobile application.”

“Relevant questionnaires have also been sent to Binance headquarters in the Cayman Islands and Binance USA for explanation,” the notice reads. Investment fraud in Pakistan was carried out by requiring users to register with Binance and transferring funds to third-party wallets under the pretext of unrealistic returns. According to the FIA ??notification:

“These schemes benefit old customers at the expense of new customers and eventually disappear when they accumulate a large capital base worth billions of rupees.”

Based on complaints filed by citizens, Pakistani agencies have identified at least 11 fraudulent mobile apps that suddenly stopped working after successfully stealing user funds. Applications identified by the FIA ??are MCX, HFC, HTFOX, FXCOPY, OKIMINI, BB001, AVG86C, BX66, UG, TASKTOK and 91fp.

In addition to directing users to register on Binance to transfer funds, the fraudsters also added victims to Telegram groups to provide “expert betting signals.” Each application hosts an average of about 5,000 customers. The notice added:

“At least 26 suspicious blockchain wallet addresses (Binance Wallet addresses) have been identified where fraudulent amounts of money may have been transferred. A letter has been written to Binance Holdings Limited providing details of these blockchain wallet accounts information and debit cards to freeze them.”

Binance was also asked to provide details, including official supporting documents and the integration mechanism of the API that fraudsters use to connect to Binance services. While the FIA ??proactively blocked bank accounts associated with suspicious apps, the notice warned:

“FIA cybercrime would justify recommending financial penalties to Binance through the State Bank of Pakistan if regulations are not complied with.”

Binance has not responded to Cointelegraph’s request for comment.

related: Pakistanis own $20B in crypto, says local association head

In December 2021, Nasir Hayat Magoon, chairman of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), revealed that the total value of crypto assets held by Pakistani citizens is $20 billion.

As Cointelegraph reported, the FPCCI chairman confirmed the figures based on a research paper published by the chamber of commerce.Backing up this claim, the 2021 Chainalysis Global Cryptocurrency Adoption Index Ranking Pakistan ranks third in index score behind Vietnam and India.