Watchdog warning after woman lost €20,000 in cryptocurrency scam

Fresh warning over the dangers of investing in cryptocurrencies

27% of complaints (1,257) received related to insurance products, with complaints most commonly concerning claim handling or rejection of an insurance claim.

Fresh warnings on the dangers of investing in cryptocurrencies have been issued by Ireland's banking, insurance and investment watchdog.

A new report from the Financial Services and Pensions Ombudsman (FSPO) for 2021 shows the agency handled more than 5,000 complaints relating to banking, insurance and investment which resulted in €7m in settlements last year.

The acting Ombudsman MaryRose McGovern revealed a noticeable increase in the number of complaints made to the FSPO in the area of investment fraud and cryptocurrency where the financial and personal impact of these fraud incidents was very significant.

It includes one woman who lost €20,000 which she borrowed to invest in cryptocurrency and later discovered it was a scam.

“Consumers should be mindful of the risks posed by investing in unregulated activities, such as cryptocurrency trading, which very often carries a higher risk and level of volatility, than regulated product offerings," McGovern said.

Her comments follow a similar warning from the Central Bank in the past week who said consumers need to be aware of aggressive advertising and promotion of crypto investments.

The €7m in settlements included €4.6m in mediated settlements in 1,153, €941,328 in compensation to complainants following formal investigations and €944,167 paid to complainants to resolve complaints during the FSPO’s formal investigation process.

27% of complaints (1,257) received related to insurance products, with complaints most commonly concerning claim handling or rejection of an insurance claim.

In addition to 600 Covid-19 related complaints received in 2020, a further 275 new complaints were received in 2021 where the complainant introduced Covid-19 as an element of their complaint.

Complaints concerning mortgages accounted for 23% of all complaints received in 2021. This includes 250 new tracker mortgage complaints during 2021, 12 years after the first tracker mortgage complaints were received in 2009.