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Cryptocurrency News Articles

Beware the Deceptive Allure: Indian Artist Falls Victim to Masterful NFT Scam

Apr 22, 2024 at 08:08 pm

A 71-year-old Indian artist was scammed by individuals claiming to be NFT art dealers. The victim, Shivaprasad R, lost INR 1.58 lakhs (approximately $1895) after paying fees to the scammers, who promised to purchase his artwork. The scammers created a website, nfttradeplace.com, and claimed to want to purchase Shivaprasad's paintings for 42 ETH. Negotiations were conducted virtually via email and Facebook. The artist paid 0.115 ETH in gas fees and requested a withdrawal of 6 ETH, but was asked to pay additional fees. Shivaprasad realized the scam when the platform continually demanded further payments to withdraw his funds.

Beware the Deceptive Allure: Indian Artist Falls Victim to Masterful NFT Scam

Beware the Deceptive Allure of NFT Scams: Indian Digital Artist Falls Prey to Masterful Con

In a sobering tale of deceit, a septuagenarian digital artist in India has become the unfortunate victim of a cunning NFT scam, losing a substantial sum of INR 1.58 lakhs (approximately $1895) to perpetrators masquerading as legitimate NFT art dealers. The incident serves as a stark reminder of the ever-present threat posed by online fraudsters who prey on unsuspecting individuals in the burgeoning realm of digital art.

Shivaprasad R (name changed), a highly accomplished chartered accountant and practicing artist, has had his work showcased in numerous local exhibitions and widely shared on social media platforms such as Instagram and Facebook. It was in October 2023 that the deceptive saga unfolded, with the scammers, posing as an "NFT art dealer," reaching out to Shivaprasad through a dubious platform called nfttradeplace.com.

With alluring promises of purchasing Shivaprasad's paintings for a substantial sum of 42 ETH (approximately INR 1.09 crore), the scammers initiated negotiations that were conducted entirely through virtual channels, primarily via email and Facebook. Enticed by the prospect of such a lucrative deal, Shivaprasad agreed to the offer and proceeded to list three of his artworks for 10 ETH each and another for 12 ETH.

On February 1, 2024, the scammers requested a seemingly innocuous payment of 0.115 ETH to their platform, claiming it was a "gas fee." Unwary of the impending deception, Shivaprasad made the payment from his crypto wallet, which he had set up at the scammers' behest.

Following the completion of his first sale, Shivaprasad requested a withdrawal of 6 ETH from his earnings. However, despite waiting patiently for days, no transaction materialized. Upon inquiring further, he was met with a demand for a "delay fee" for allegedly holding up the withdrawal of his cryptocurrency.

"This delay fee was never discussed nor was it exhibited on the website," Shivaprasad stated in a disheartened tone.

Determined to resolve the issue, Shivaprasad, lacking sufficient ETH, requested the scammers to accept the delay fees in fiat currency. To his surprise, the scammers agreed to this request, and Shivaprasad subsequently made four payments to the accounts of Mohammed Ekramul Haque and Mohammad Farooq. The involvement of these individuals as the masterminds behind the scam remains unverified.

The final payment to the scammers was sent by Shivaprasad on March 15. However, much to his dismay, the platform continued to demand further payments, hindering his ability to withdraw his 6 ETH. It was at this point that the realization dawned upon Shivaprasad that he had fallen victim to a meticulously crafted NFT scam.

On April 17, Shivaprasad sought recourse by contacting the cyber police and filing charges under Sections 66C (punishment for identity theft) and 66D (punishment for cheating by personation by using computer resources) of the Information Technology (IT) Act and Section 420 (cheating and dishonestly inducing delivery of property) of the Indian Penal Code (IPC).

"Tracing cryptocurrency trails is an extremely challenging task. As of now, we have requested bank details and domain details of the email address used by the scammers," remarked an officer privy to the investigation.

The rise of cryptocurrency scams has become a prevalent concern in India, despite concerted efforts by local authorities to combat such fraudulent activities. Just last week, the Enforcement Directorate (ED) initiated an investigation into a massive $800 million Ponzi scheme involving a high-profile Bollywood celebrity.

Another recent incident highlighted a job recruitment scam, where fraudsters drained victims' crypto wallets by employing spyware disguised as applications purportedly essential for the onboarding process.

Shivaprasad's experience serves as a cautionary tale for all digital artists and art enthusiasts engaging in the NFT ecosystem. The anonymity and decentralized nature of cryptocurrency transactions can provide a fertile ground for scammers to operate with impunity.

It is imperative for individuals to exercise utmost vigilance when dealing with unsolicited offers and platforms promising astronomical returns. Thorough research and verification of the authenticity of potential buyers are crucial to safeguard one's digital assets from falling prey to deceptive schemes.

As technology continues to advance and reshape various industries, it is more important than ever to remain informed and alert to the ever-evolving tactics employed by cybercriminals. By staying vigilant and exercising caution, individuals can mitigate the risks associated with online scams and protect their hard-earned assets from falling into the hands of malicious actors.

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Other articles published on Jan 10, 2025