The Denver Division of the Federal Bureau of Investigation (FBI) is warning that as cryptocurrencies become more common, the number of people falling victim to crypto scams is on the rise, and so are financial losses. Investigators out of the Denver office are seeing an emerging trend in which mature adults are caught up in crypto investment scams, especially involving Tether (USDT) and USD Coin (USDC).
In a common scenario, the victim is approached on a social media platform, dating app, or discussion forum with a cryptocurrency investment opportunity. The victim is directed to a link or phone number to set up the investment account. This is a scam—the link or phone number is controlled by the fraudster, who has set up a fictitious support site. Once the victim transfers the funds, the fraudster disappears with the money.
Nationwide, of the reported crypto fraud losses that began on social media, most are investment scams: Since 2021, $575 million of all crypto fraud losses reported to the Federal Trade Commission (FTC) were about bogus investment opportunities, far more than any other fraud type. More than 46,000 people have reported losing over $1 billion in crypto. Their reported losses in 2021 were nearly 60 times what they were in 2018.
In 2021, Coloradans reported losing almost $25 million to investment scams, according to the FBI’s Internet Crime Complaint Center (IC3). Coloradans 60 and older lost more money to scams than any other age group.
Here are some examples of the cryptocurrency investment fraud victims in Colorado recently:
“As more people use and invest in cryptocurrency, the more crypto scams we see,” said Special Agent in Charge Mark Michalek. “The FBI will investigate allegations of crypto scams, but the best path is not to fall victim in the first place. FBI Denver wants people to be aware of the warning signs and be alert to the ways fraudsters try to reel them in.”
Cryptocurrency investment scams often promise you can “make lots of money” with “zero risk,” and the con often starts on social media, online dating apps, or other sites. These scams can start with an unexpected text, email, or call. And, with investment scams, crypto is central in two ways: It can be both the investment and the payment.
Specifically, Tether (USDT) and USD Coin (USDC) are tied to the U.S. dollar; an investment pitch into these cryptocurrencies should raise additional red flags that the opportunity is likely a scam.
FBI Denver is seeing two major cons when it comes to cryptocurrency investment fraud:
Here are some tips to protect yourself against cryptocurrency investment fraud (compiled from FBI Denver, IC3, and FTC):
If you believe you are a victim of cryptocurrency investment fraud:
For more information:
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