The Alberta Securities Commission (ASC), in collaboration with the Edmonton Police Foundation (EPF) and the Edmonton Police Service (EPS), has launched a new initiative aimed at tackling the growing threat of online crypto investment fraud. The ScamShield: Investor Protection Challenge seeks creative solutions from experts across academia, technology, and innovation sectors to enhance investor protection and curb rising investment scams.
This initiative, part of the EPF’s Community Solutions Accelerator (CSA), comes with a prize pool of up to $130,000 for the most effective ideas. The challenge complements ongoing efforts by the ASC and law enforcement to combat investment fraud, which has become a significant issue in Canada, particularly tied to cryptocurrency schemes.
“Anyone can fall victim to a scam, and the impact can be devastating”
In 2023, the Canadian Anti-Fraud Centre reported over $309 million in investment fraud losses, with more than 60% linked to crypto scams. Edmonton alone saw over 80 victims suffer a combined loss of $7 million last year. Given the underreporting of such crimes, authorities believe the true figures are even higher.
“Anyone can fall victim to a scam, and the impact can be devastating,” said Cynthia Campbell, Director of Enforcement at the ASC. “By partnering with the EPF and EPS, we aim to explore new ways to protect Alberta investors and safeguard our capital market.”
Fraudsters are increasingly using sophisticated technology and psychological tactics, including social media deepfakes, romance scams, and emotional manipulation, to target victims. Many people who fall prey to these scams do not view themselves as traditional investors but are drawn in with promises of solving financial problems.
“Crypto investment fraud has become a favored method for criminals, exploiting both the complexity of cryptocurrency transactions and the public’s limited knowledge of this high-risk asset,” said Deputy Chief Devin Laforce of the EPS. “As criminals refine their techniques, law enforcement is working to bring them to justice, but we need broader support to address this issue.”
The challenge, which is open for submissions until November 4, 2024, invites experts from various disciplines to propose new ways to prevent fraud. More details on eligibility and submission requirements are available at HeroX.
The ASC, responsible for administering Alberta’s securities laws, works alongside the Canadian Securities Administrators to foster a fair capital market across the country. Through its partnerships with EPS and EPF, the ScamShield challenge hopes to spearhead innovative solutions to protect Canadian investors and mitigate further losses.
