Crypto scam operations are on the rise. The Federal Bureau of Investigation (FBI) said that together with the normal methods of payment like wire transfers and prepaid cards, crypto ATMs are also becoming a prominent channel for crypto investment scammers.
The United States Federal Bureau of Investigation (FBI) Miami Field Office has now warned that crypto ATMs are becoming a popular method that criminals and scammers use to get funds from defrauded victims.
This information was revealed as part of an October 3 public warning about “pig butchering scams” where the scammers pose as long-lost friends or possible romantic partners to swipe money from their unsuspecting victims.
These scammers “fatten up” their victims by giving them a supposedly genuine interest to win their trust, and then slowly introduce investment discussions into the relationship.
In the public service announcement in conjunction with the Internet Crime Complaint Center (IC3), the FBI insisted that victims of the pig-butchering crypto scam methods mostly do not stand a chance of getting their funds back.
Nevertheless, the FBI noted that they have discovered that scammers have been mostly directing their victims to transfer their funds through crypto ATMs. They are also employing well-known methods like wire transfers and prepaid cards. The FBI noted:
“Many victims report being directed to make wire transfers to overseas accounts or purchase large amounts of prepaid cards. The use of cryptocurrency and cryptocurrency ATMs is also an emerging method of payment. Individual losses related to these schemes ranged from tens of thousands to millions of dollars.”
According to the FBI, in the “pig butchering” scams the victims are:
“Coached through an investment process” and “encouraged to make continuous deposits by the fraudsters. When the victims attempt to cash out their investments, they are told they need to pay income taxes or additional fees, causing them to lose additional funds.”
Crypto ATMs have long been used by scammers who pose as public officials, law enforcement agents and employees of local utility firms. They coerce their victims to send them payments under the guise of paying off bills and unpaid taxes to avoid more penalties.
There are almost 33,500 crypto ATMs in the US, according to data from Coin ATM Radar. Notably, the United States accounts for 87.4% of the global crypto ATM distribution. The US Federal Trade Commission sent out a stern warning about crypto ATM scams in January. At the time, the regulator noted that the scammers sometimes pose as possible romantic partners.
The FBI urged people to authenticate the validity of any investment opportunity introduced by such people. Always be on the lookout for domain names impersonating legitimate exchanges and misspelled URLs and to not download any apps in case the legitimacy cannot be authenticated.
Buy Bitcoin NowLaw enforcement agencies throughout the United States have now warned about pig butchering and romance crypto scam strategies severally. While it might be assumed that the victims are not well-educated about technology or investing, it is not always the case.
In June 2022, it was stated that tech-savvy professionals from Silicon Valley were also being duped by a wave of pig butchering scams in San Francisco, with many people losing over $1 million per person to this type of financial fraud.
