Online scammers are now targeting Asian Americans on social media and dating sites, romancing them before convincing them to buy into their cryptocurrency schemes, The Boston Globe reported Tuesday.
This is what happened to 51-year-old Newtonville resident Cindy Tsai, according to the newspaper.
She met a handsome young man who told her his name was Jimmy on WhatsApp in October 2021 — a time when the stresses of her life made her glad for a distraction, she told the Globe.
The newspaper wrote that Jimmy was attentive to Tsai and often complimented her, but also shared his success with cryptocurrency with her, sending her photos of his returns. He soon pressured her to invest until she gave in, according to the Globe.
Tsai eventually bought nearly $20,000 worth of Ethereum, which she transferred to an account that appeared to be linked to a cryptocurrency exchange website, the paper reported. But the site was actually fake and controlled by Jimmy, who had lied about who he was, according to the Globe.
Tsai lost $2.5 million, she told the paper.
What happened to Tsai seems to be getting more common. Since the pandemic began, online romance scams have exploded, the Globe reported.
About 56,000 romance scams were reported to the Federal Trade Commission in 2021, more than double the number of reports filed with the agency in 2019, according to the paper. Last year, victims lost $547 million, a 78 percent increase from 2020, the Globe wrote.
According to the newspaper, these sophisticated scams usually target a younger audience than traditional schemes due to the use of cryptocurrency. It reported that one survey found that the most common target for these scams was millennial women.
“Once you’ve been groomed enough, it’s like quicksand,” Tsai told the Globe. “You so [badly] want to believe that what you’re doing is true, and that this relationship with this person is real.”
The newspaper wrote that thousands of people around the world have fallen prey to this type of scam. It reported that people of Asian descent and Chinese speakers are often targeted because they share a common language and ethnicity with the scammer, allowing the thieves to gain the trust of their victims.
“Certainly, the pandemic affected everyone quite a lot and sort of fueled that loneliness,” Grace Yuen, a Massachusetts-based spokesperson for the Global Anti-Scam Organization, told the Globe. “I think the Asian community, in general, was quite COVID-phobic, and that … made them particularly susceptible to the scam because they wanted to sort of scratch that social itch, but they weren’t able to do that in the conditions of the pandemic.”
The newspaper reported that these scams have been using the growing interest in — and lack of knowledge about — cryptocurrency to their advantage.
“Excitement about investing in cryptocurrency — paired with just a general lack of understanding about how it works . . . is just kind of a recipe for some very effective scams,” Emma Fletcher, a senior data researcher at the FTC, told the Globe.
The romance scheme used on Tsai is believed to have originated in China, where it’s known as the “pig-butchering scam,” the Globe reported. The idea is that victims are “fattened up” with romance, flattery, and attention before being led into financial slaughter, according to the paper.
The Globe reported that these scammers often find their victims on dating apps, such as Hinge and Tinder, and social media sites, such as Instagram, Facebook, and LinkedIn. They then shift the chats over to WhatsApp, which encrypts its messages, according to the paper.
The scammers will pretend to be big-shot crypto investors and convince their victims to buy cryptocurrency, the Globe wrote. They then tell the victims to transfer the cryptocurrency to a fake exchange website that they control, according to the newspaper.
The victims figure out what happened when they realize they can’t withdraw the money, the Globe reported.
Kristen Setera, a spokesperson for the Boston division of the FBI, told the newspaper that the fake exchange websites can be set up to look like an actual exchange website, or can look entirely different.
Because cryptocurrency doesn’t work like normal money, Setera told the Globe, it is nearly impossible to recoup, so it’s unlikely Tsai and other victims will ever get their investments back.
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