FBI Releases Five Warnings to Help Protect Investors in the Cryptocurrency Space

The Federal Bureau of Investigation (FBI) has released several warnings to help protect investors in the cryptocurrency space. As scams grow more advanced

The Federal Bureau of Investigation (FBI) has released several warnings to help protect investors in the cryptocurrency space. As scams grow more advanced, the agency urges people to stay alert and informed.

According to the agency, reports to the FBI’s Internet Crime Complaint Center (IC3) show billions of dollars lost in crypto fraud in just the past year alone. In 2023, there were more than 69,000 reports of crypto fraud.

Here are five key warnings that every investor should understand:

Investment Scams Are Growing Rapidly

The FBI says investment scams are the most common type of crypto fraud. They come in many forms, but they usually involve someone promising large returns with little or no risk. Scammers use fake websites and apps that look real. They create professional-looking charts, live price trackers, and fake testimonials.

Once someone invests, the scammer may even show fake profits to build trust. Then, when the victim tries to withdraw their money, the scammer vanishes or demands more payment.

These scams usually begin online. Social media and messaging apps are the main tools scammers use. A simple message offering a “great opportunity” can lead to large losses. The fraudster might be a friend on social media, a financial expert they met in a group chat, or a trader who claims to have special knowledge. They slowly gain the victim’s trust before introducing the fake investment.

Older Adults Are Prime Targets

People over the age of 60 are more likely to be victims of crypto fraud than any other age group. In 2023, seniors lost more than $1.6 billion to these schemes.

Scammers often contact them through social media or emails. They build a friendly or romantic relationship first. Later, they suggest investing in cryptocurrency.

This tactic is known as a “pig butchering scam.” The term means the scammer 'fattens' the victim with attention before 'butchering' them financially.

These scams are especially dangerous because they play on emotions. The victim thinks they are helping someone they trust. The scammer may even promise marriage or a future together. Once the victim sends money, the scammer keeps asking for more, using excuses like taxes or fees. By the time the victim realizes it is fake, the money is gone.

Romance and Friendship Used as Tools in Crypto Scams

Romance scams are another top warning from the FBI. These frauds involve fake relationships created online. The scammer pretends to care about the victim and gains their trust over time. After weeks or months, they introduce a crypto investment. They might say they have inside knowledge or access to a new platform.

The victim feels emotionally connected and wants to support their partner. They send money, expecting profits. Instead, they are giving funds to a criminal. Sometimes, the scammer encourages the victim to take out loans or sell belongings. They can lose thousands or even millions before realizing the truth.

The FBI says these scams are hard to detect because they happen slowly. There is no upfront pressure. Instead, the scammer carefully builds a believable story and waits until the victim is emotionally involved.

Scammers Pretend To Be Authorities

Many scams now involve criminals pretending to be from the government. Victims receive phone calls, emails, or texts that look official. The scammer says they are from the FBI, IRS, or another agency. They claim the victim is being investigated or that their funds are at risk. Sometimes, they say there is a national security issue.

To “protect” the money, the scammer tells the victim to convert their funds to crypto and send them to a safe wallet. Of course, that wallet belongs to the scammer. Victims panic and do as instructed, not realizing it’s all fake. The FBI says no agency will ever ask people to move their money in this way.

These scams use fear to push quick action. Scammers often tell the victim not to speak to anyone else. They claim the situation is confidential or sensitive. The FBI says their officials do not operate like this. They do not contact people through social media or demand payment in cryptocurrency.

Recovery Scams Target Previous Victims

The FBI warns that being scammed once does not mean the danger is over. Some criminals return to victims pretending to offer help. They claim they can recover lost funds. These “recovery scams” often use fake legal firms, security companies, or even pretend to be the FBI itself.

They ask for a fee to start the process. Sometimes they say the money will go toward court costs, lawyer fees, or crypto unlocking tools. Victims who are desperate to get their money back pay the fee. But after the payment, the scammer disappears again.

In some cases, the scammer sells the victim’s contact information to others, starting a new wave of fraud. The FBI advises that people should never pay anyone who claims they can recover lost crypto. Real law enforcement does not charge fees to investigate crimes.

The FBI’s Data and Regional Trends

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