Cryptocurrency scams spike as Bitcoin, Dogecoin, Shibu Inu are sought by investors, feds say
Consumers have lost more than $80 million in cryptocurrency scams as more investors are paying attention to alternative investments such as Bitcoin, Dogecoin and Shibu Inu, the Federal Trade Commission (FTC) said Monday.
It’s a ten-fold increase over the same period the year before, the agency said.
The FTC received nearly 7,000 crypto-related complaints in the last three months of 2020 and in the first quarter of 2021, it said. The median loss per consumer was $1,900, the FTC said.
The scams took on several forms, including ones that started with offers of investment “tips” or “secrets” in online message boards, which led people to bogus investment websites, the FTC said.
“Another common form of the scam involves a promise that a celebrity associated with cryptocurrency will multiply any cryptocurrency you send to their wallet and send it back,” it said. “In fact, consumers reported losing more than $2 million to Elon Musk impersonators alone since October.”
People between the ages of 20 and 49 were more than five times more likely than older investors to fall for the scams, with consumers in their 20s and 30s losing more to investment scams than any other kind of fraud. More than half of the investment scams were related to cryptocurrency, it said.
The FTC said to watch for warning signs for these scams, such as promises or guarantees that you will make money, or that you will get free money toward your investment.
“Before you invest, check it out,” the FTC said. “Research online for the name of the company and the cryptocurrency name, plus words like `review,’ `scam,’ or `complaint.’ See what others are saying.”
You can report scams of any kind to the agency here.
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Karin Price Mueller may be reached at [email protected].