Cryptocurrency Scams Targeting Investors Through Fake Relationships on the Rise, Warns Federal Officials
As per the latest warning from federal officials, investors are facing an increased risk of falling victim to cryptocurrency scams linked to fraudulent relationships formed on social media, dating apps, and networking sites.
Crypto Scammers Exploiting Trust in Fake Relationships
Fraudsters are utilizing dating apps, social media platforms, and professional networking sites to pose as romantic interests, old friends, or investment professionals to gain the trust of their targets. Once a certain level of trust is established, they introduce the idea of investing in cryptocurrencies, leading to fraudulent schemes and financial losses for victims.
Gurbir S. Grewal, director of the Securities and Exchange Commission’s Division of Enforcement, highlighted the escalating threat of relationship investment scams involving cryptocurrencies. The SEC recently took enforcement actions against criminals involved in fraudulent schemes through platforms like WhatsApp, LinkedIn, Instagram, and fake crypto trading platforms.
The Escalating Rise in Crypto Scam Losses
The use of cryptocurrencies like bitcoin and ethereum has surged among criminals, leading to a significant increase in crypto-related scams. The FBI reported that consumers lost an estimated $5.6 billion to crypto scams in 2023, marking a 45% rise from the previous year. Investment scams accounted for a large portion of these losses, highlighting the growing threat posed by fraudulent activities in the crypto space.
The Serious Impact of Long Con Crypto Scams
Criminals are increasingly turning to cryptocurrencies for fraudulent activities due to its decentralized nature, quick transactions, and global mobility of funds. These scams, often portrayed as long cons, have the potential to cause substantial financial harm to victims. The Cybercrime Support Network noted that the average dollar loss per person in romance-driven crypto scams is around $178,000, emphasizing the severity of the issue.
Protecting Yourself against Crypto Scams
To safeguard against crypto romance scams and other fraudulent activities, experts recommend staying cautious of investment advice from online acquaintances, verifying the legitimacy of investment platforms, and being wary of offers that sound too good to be true. Checking the registration of an investment firm on platforms like BrokerCheck and avoiding suspicious-looking apps or websites are crucial steps in protecting oneself from falling prey to crypto scams.
The information in the article is for informational purposes only. It does not constitute any investment advice. The author and CryptoBlockNews.com are not responsible for your profits or losses arising from your investments. Investment is ultimately based on many foundations such as knowledge, accumulation, experience, research and personal decisions.
