(COLORADO) — FBI Denver is warning of cryptocurrency scams impacting Coloradans, specifically a variant of the “pig butchering” scam.
“In this scheme, fraudsters, posing as highly successful traders in cryptocurrency, entice victims to make purported investments in cryptocurrency providing fictitious returns to encourage additional investments,” according to a recent FBI press release.
Investigators at the FBI Denver office said there is a new trend where adults are being caught up in crypto investment scams, especially involving Tether (USDT) and USD Coin (USDC).
According to FBI Denver, victims are being approached on social media, dating apps, or discussion forums with an opportunity to invest in cryptocurrency. The victim is then sent a fraudulent link or phone number to set up an investment account, controlled by scammers, who then disappear with the money once the victim transfers funds.
FBI Denver: Crypto fraud losses since 2021 in the U.S.
- $575 million of all crypto fraud losses reported to the Federal Trade Commission (FTC) were about bogus investment opportunities.
- More than 46,000 people have reported losing over $1 billion in crypto.
- Reported losses in 2021 were nearly 60 times what they were in 2018.
According to the FBI’s Internet Crime Complaint Center (IC3), Coloradans 60 years and older “lost more money to scams than any other age group.” In 2021, IC3 said Coloradans reported losing almost $25 million to investment scams.
“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.”
FBI Denver: Warning signs to look out for
- Cryptocurrency investment scams often promise you can “make lots of money” with “zero risk.”
- The con often starts on social media, online dating apps, or other sites.
- These scams can start with an unexpected text, email, or call.
- With investment scams, crypto is central in two ways: It can be both the investment and the payment.
FBI Denver said it is seeing two major cons when it comes to cryptocurrency investment fraud; “a so-called “investment manager” contacts you,” or “an online “love interest” wants you to send money or cryptocurrency to help you invest.”
FBI Denver: Tips to protect yourself
- If a company or person promises you’ll make a profit, that’s a scam: If an investment opportunity sounds too good to be true, it likely is. Be cautious of get-rich-quick schemes.
- Scammers make big claims without details or explanations: Honest investment managers or advisors want to share that information and will back it up with details.
- Before you invest in crypto, search online: Search the name of the company or person and the cryptocurrency name, plus words like “review,” “scam,” or “complaint.”
- Navigate to any websites independently: Do this rather than using a provided link or QR code.
- Beware of new apps: If you are asked to use a new app, download it via your usual app store, not from a provided link.
- Check emails: If you are emailing with a purported investment advisor, make sure the representative has a business email account.
- Resist any pressure to act quickly: A legitimate advisor will not push you to make a hasty decision.
FBI Denver: If you believe you are a victim
- File a complaint with the FBI’s Internet Crime Complaint Center, via www.ic3.gov
- If you paid in cryptocurrency, report the fraud to the exchange company you used to send the money.
- Keep all original documentation, e-mails, faxes, and logs of all communications, including financial transaction information.
- Expect additional attempts at contact. The scammers often share or sell their victim database information.