Cryptocurrency is a form of virtual currency which provides users some degree of anonymity and, as it grows in popularity, so do cryptocurrency scams. The most common scams often begin with a strange text message, phone call, or email. Scammers will often lure victims to cryptocurrency ATMs or web-based investment sites or exchange platforms, where it is relatively easy to convert U.S. dollars into cryptocurrency such as Bitcoin, Ethereum, and Solana.
A victim is often led to believe that their bank account or investments are under attack. The victim is then prompted to convert those assets to cryptocurrency and send them to a “secure” account, which is controlled by the scammer.
Scammers may also tempt victims with a “get rich quick” scheme, enticing them to invest in a new cryptocurrency coin, which is ultimately a fake investment. Here are some red flags to look out for:
· No legitimate bank, business, or government agency will direct you to withdraw money from your bank account.
· If a third party is sending you to a cryptocurrency ATM, it is almost certainly a scam.
· Be aware of text messages from unknown numbers that appear to be making an attempt to gain familiarity with you or your business. These texts often begin with something low threat such as, “Hi friend” or “Didn’t we meet last week?”
· If you own cryptocurrency, no legitimate entity will ever ask you for your private keys or account passwords. Never share those items.
· If you decide to invest in new cryptocurrency coins, always check to see if they are listed on a trusted, major exchange and research the “initial coin offering” paper. Never trust coin endorsements on social media, through email, or any source promising unrealistic profits.
If you believe that you have been scammed or are currently being scammed, report it immediately to your local police department or State Police troop; police can investigate and possibly recover stolen funds. Earlier this month, CSP was able to recover stolen Bitcoin on behalf of a CT resident who fell victim to an ATM scam. Scammers are looking to cash out quick, so the sooner you report an incident, the better the chances of making a recovery.