Another fake regulator has come to the fore, attempting to trick brokers into buying fake licenses.
Calling itself the Central Reserve Authority of Western Sahara, the phoney regulator purports to provide a range of licenses to financial services and gambling companies.
The website for the ‘regulator’ says that it was launched in 2017 and oversees activities for all financial services businesses in the Western Sahara. Interestingly the only listed phone numbers are from Cyprus and Greece.
The Western Sahara is a disputed territory. Morocco controls the territory and claims ownership of it but there is a local independence movement that wants to split away from the North African country.
TradeInformer understands that the ‘regulator’ has been reaching out to brokers, legal agents, and other compliance executives in order to sell them the license.
This is not the first fake license operator that has come to market.
For example, in 2024, a ‘regulator’ in the tiny Pacific island of Nauru started to trying to sell its services to clients. Officials in the small country ultimately confirmed that it was a fake and had no connection to the island.
A more popular option has been the Comoros license, which is also fraudulent, something that the country’s central banking authorities have confirmed on more than one occasion.
Some firms are happy to take these licences as it gives them access to technology and provides some level of respectability to end clients, even if they know the actual license isn’t real.
However, doing this usually leads to problems down the line. For example, firms will find it harder to get real licences and access banking services.
