BBB Warns of Rising Crypto Investment Scams
Investment scams are skyrocketing in 2023, with a significant increase involving cryptocurrency, as reported by the Better Business Bureau (BBB). Understanding how these scams operate can help protect your hard-earned money.
How Scammers Target with Cryptocurrency
Scammers often use romance and social platforms to lure unsuspecting victims, making use of the complexity surrounding cryptocurrencies to their advantage. For example, they might send unsolicited investment advice through social media channels like WhatsApp or dating sites. You might also encounter these scams through posts on hacked Facebook accounts of friends or family.
Example of a Scam
Imagine getting a message from someone on a dating app who gradually introduces you to an "amazing" crypto investment. They claim it’s a small, quick commitment but promise big returns. This should be a red flag.
Staggering Losses in 2023
The average financial loss per victim rose dramatically from $1,000 in 2021 to nearly $6,000 in 2023. In total, consumers lost more than $4.6 billion to such scams last year, outpacing losses in any other fraud category, according to the Federal Trade Commission (FTC).
Warning Signs and Protection Tips
- Avoid 'Guaranteed' Returns: Be wary of promises of "guaranteed" returns or "low-risk, high-reward" opportunities. These are typically too good to be true.
- Watch for High-Pressure Tactics: Be cautious of sales pitches pushing you to invest immediately or involving pressure from so-called "opportunity meetings."
- Understand the Investment: Always ask how an investment makes money, particularly if you're required to recruit others. Such schemes often turn out to be pyramid schemes.
Equipping yourself with knowledge about these tactics can save you from becoming the next victim. Be skeptical of investment opportunities that come out of nowhere, especially involving cryptocurrency, and always verify the credibility of the person or platform before proceeding.
