How an online romance and cryptocurrency fraud cost one man almost $300,000 | #lovescams | #datingapps

When Mike downloaded the dating app Tinder, he was looking for companionship with someone nearby. But, in July, he matched with a woman named “Jenny” from Malaysia and began exchanging messages on the dating platform and then on WhatsApp, a messaging app. While the pair discussed their lives and traveling together, after a month or so Jenny turned the conversation to Bitcoin.

“She started telling me about her uncle who worked for J.P. Morgan… he was the world expert in Bitcoin options,” said Mike, who asked NBC News not to reveal his last name to protect his privacy. “ I wasn’t look[ing] to invest in cryptocurrency. I was looking for somebody to have some fun with, you know, ‘Let’s go hiking, let’s go have dinner.’”

They’d never met, but Jenny persuaded him to invest $3,000 with a legitimate cryptocurrency exchange website, Then she encouraged him to transfer that money to a different platform, said Mike, who is retired and single. “She would get me excited and say, ‘Mike, so you got to send more money. The more you have in here, the more you can make.’”

When his cryptocurrency portfolio hit $1 million in value, he was assigned his own “teacher analyst” named Devon.

But after four months, when Jenny and Devon told him to send his tax payments to the Department of Homeland Security and not the IRS, Mike grew suspicious. He tried to transfer money out of his account — and he couldn’t. That’s when he realized none of it was real — his gains or his girlfriend “Jenny” — except for his epic losses. 

“I spent about $277,000,” Mike said.

Mike downloaded the dating app Tinder looking for companionship with someone nearby. Courtesy photo

Cryptocurrency romance scams, like the one Mike fell for, have become increasingly common thanks to the boom in online dating and the use of cryptocurrency — and the size of his losses is not unusual. 

Swindlers use dating apps and websites to lure in victims with flirtation and the promise of romance and quick financial returns, tricking them into fraudulent cryptocurrency investments. The search for love online ends with a broken heart and an empty bank account.

“You’ll see earnings; you’ll even be able to withdraw some money at some point. But then when you want to draw your whole balance, that’s when you realize you’ve been a victim because they say that there’s usually a penalty or fee, and it’s in the hundreds of thousands of dollars,” said Amy Nofziger, director of fraud victim support at the American Association of Retired Persons Fraud Watch Network.

Nofziger said her team currently receives two to three complaints a day involving crypto romance scams, compared to one to two a week last year, and the losses are staggering.

“The victims who are involved in these scams, they’re losing hundreds of thousands of dollars to even millions of dollars,” said Nofziger. “If you think it will never happen to you, you’re wrong. It can and it will, and I guarantee you someone in your inner circle right now is the victim of a scam.”

In an online memo, Tinder has alerted users not to send money online and be cautious if someone asks you to leave the dating service to communicate directly or avoids meeting up in-person.

In a statement to NBC News, WhatsApp said someone can receive a “suspicious message on any service, including email and SMS, and anytime that happens, we strongly encourage everyone to use caution before responding or engaging.”

“Unlike SMS and other messaging platforms, on WhatsApp people can use the tools that we provide within the app to send us a report, report a contact or block contact,” the messaging app said.

As many people have become swept up in the cryptocurrency craze, scammers have capitalized on it, adding a new twist to timeworn tricks. While some scammers fool victims into investing in fake cryptocurrency, others convince victims to part with the real thing.

Cryptocurrency is rapidly becoming the preferred payment method for traditional scams like phishing, where someone sends a text message, e-mail, or makes a phone call demanding payment for anything from taxes to insurance, according to Ricky Patel, acting special agent in charge at Homeland Security Investigations in New York.

Patel warned swindlers are targeting a “whole gamut of age groups and people. And [scammers are] constantly reaching out to them and hitting them, whether it’s emails or phone calls or text messages, everything, every avenue they’re actually trying to exploit.”

In 2021, according to the Federal Trade Commission, people reported losing $294 million in cryptocurrency payments to fraudsters, compared to losing about $44 million in credit card payments to them. 

“Once you send that money, it goes to exchanges. And once they have it, they hold it, and they release it, it’s almost impossible to get it back, especially if you don’t know who the other side is,” Patel said. 

As for Mike, he doubts he will recover the hundreds of thousands he lost to bogus investments, but said he reported his case to the AARP, the FTC, the FBI and HSI and wants to see someone held accountable. 

“I want them to spend the rest of their lives in prison. I don’t want them to attack anybody else,” Mike said.

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