Rise in illicit financial schemes targeting small online businesses in Russia, reveals Central Bank

In 2023, the Russian regulator identified 2,940 financial pyramids, representing an increase of 1.5 times from the previous year, according to The Moscow Times, which cited Interfax.

The majority of these financial pyramids are small projects associated with cryptocurrencies, wherein almost half of them encourage users to utilize overseas payment services. The pyramid schemes' founders predominantly market themselves on social media platforms and through the Telegram messenger.

There has also been a significant uptick in unauthorized loan companies, estimated by the Central Bank to be about 1,884, increasing by around 9 percent. Nearly half of these firms operate entirely online, lacking physical headquarters.

The Central Bank discovered that a total of 5,700 entities, projects, and individuals were engaged in unlawful activities, marking over a 15 percent rise from 2022.

The regulatory body reported that last year, it blocked access to around 11,000 illicit online businesses, which included over 3,000 websites, messenger channels, and chatbots, on its own initiative.

The Russian Foreign Ministry reported a rising incidence of other types of fraudulent money-seeking attempts last year. The primary victims were usually the elderly, who received phone calls from individuals attempting to convince them that someone was trying to take loans under their names or withdraw money from their accounts.