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Police in London have publicly announced the sentencing of two people convicted of luring investors with a non-existent digital currency.

UK authorities have not been kind to scams targeting investors, especially those involving cryptocurrencies.

Raids of unauthorized cryptocurrency ATMs have spread rapidly across the UK, complementing growing efforts in this regard.

A British court has handed down harsh sentences to two cryptocurrency fraudsters found guilty of taking money from would-be investors promising high returns.

A judge at Southwark Crown Court sentenced Ross Jay and Michael Freckleton. They will serve six years and three months and six years and six months respectively. The court found them guilty of conspiracy to defraud, which began as early as 2015.

Cryptocurrency scammers scam strangers

The pair made offers to potential investors, according to a statement from the City of London police. How would you like to invest in a cryptocurrency called "Telecoin"?

The only obstacle? Telecoin did not exist, and the company the two of them ran, Digi Ex, was a dubious shell company. One with real employees but no legitimate investment activity.

In those heady early days, cryptocurrencies were such a hot commodity that excited investors piled into telecom coins without any investigation, according to London police.

The duo reportedly did not use any of the funds they received in excess of $635,000 to trade crypto tokens. Instead, they paid themselves and Digi Ex employees high wages.

Scammers use cryptocurrency ATMs too

The London police's explanation of the case, in which cryptocurrencies have become popular so quickly that people hardly know what they are getting themselves into - has been bolstered by the breakneck spread of cryptocurrency ATMs in the UK.

Their rise and unregulated use has alarmed UK authorities so much that they have imposed strict registration requirements and conducted widespread raids on cryptocurrency ATMs.

The FCA has teamed up with the police to carry out high-profile raids on cryptocurrency ATMs in East London and Leeds. They mean to turn them off. Even cryptocurrency ATMs are becoming more common and freely operating in other countries.

Cryptocurrency fraudsters sometimes take advantage of Bitcoin ATMs in the UK. Source: Coinatmradar.com

Detective Chief Inspector Lee Parish issued a warning against firms not registered with the Financial Conduct Authority (FCA).

Parish said: "The verdict should serve as a reminder not to invest in emerging currencies that may be unstable in volatile financial markets. Do your research and choose a firm that is FCA registered and globally recognized. In case of doubt, please contact Accredited Financial Advisor."

The cryptocurrency market has been an area of focus for the FCA this year and in recent years. As a result, the organization disclosed in March 2022 that it conducted no fewer than 300 investigations into unregistered cryptocurrency businesses in the six months to September 2021.

The FCA's ScamSmart website received 4,300 reports of possible cryptocurrency scams in six months.