The UK's Serious Fraud Office has arrested two men and raided properties in connection with the suspected fraud of a $28 million cryptocurrency scheme called Basis Markets. The agency is appealing for information from investors after the project's collapse in 2022. This marks the SFO's first major cryptocurrency investigation.
The Serious Fraud Office (SFO) announced an investigation into the collapse of Basis Markets, a cryptocurrency scheme that raised approximately $28 million (about £21.4 million) through two public fundraisers in November and December 2021. The first fundraiser involved the sale of non-fungible tokens, while the second aimed to create a 'crypto hedge fund.' In June 2022, investors were informed that proposed new US regulations would prevent the project from proceeding as planned, prompting scrutiny over the fate of the funds.
Supported by the Metropolitan Police and West Yorkshire Police, the SFO conducted raids on properties in Herne Hill, London, and near Bradford, West Yorkshire. Two men—one in his thirties and the other in his forties—were arrested on suspicion of multiple fraud and money-laundering offences. The SFO described Basis Markets as a suspected fraudulent scheme that is not a company.
Nick Ephgrave QPM, Director of the SFO, stated: 'With our expanding crypto currency capability and growing expertise in this area, we are determined to pursue anyone who would seek to use cryptocurrency to defraud investors. Today’s action is an important step in our investigation, and we’re urging anyone with information to come forward and support our enquiries.'
Solicitor General Ellie Reeves MP added: 'Fraud is a destructive crime, that harms communities and destroys business confidence. Those committing fraud aren’t just taking away from hard-working members of the public but undermining British values of fairness and playing by the rules. As Solicitor General, I will resolutely support the Serious Fraud Office to tackle the scourge of cryptocurrency fraud and protect consumers. I urge anyone with information to come forward and assist the SFO with their investigations.'
This is the SFO's first major cryptocurrency case. Earlier this year, in June, the agency received over £8 million in extra funding over three years to enhance its crypto capabilities, including asset recovery. Investors can contact the SFO at BasisMarkets@sfo.gov.uk.
