Crypto Scammers Are Taking Advantage of High Inflation and Cost-of-Living Crisis
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Crypto Scammers Are Taking Advantage of High Inflation and Cost-of-Living Crisis

Created 2mo ago, last updated 2mo ago

Times are tough for many of us — and it seems this is drawing some desperate consumers into investing in schemes that are simply too good to be true.

Crypto Scammers Are Taking Advantage of High Inflation and Cost-of-Living Crisis

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Crypto scammers are taking advantage of the cost-of-living crisis to dupe unsuspecting consumers, British officials have warned.

The Financial Ombudsman Service has issued a scam alert after seeing a spike in fake investment schemes — and many of them involve digital assets.

Typically, victims are encouraged to buy crypto through a legitimate exchange — and after this, they're told to move the funds to what they're told is a genuine investment platform.

From here, they're often given fictitious balances that make it seem like the value of their digital assets has surged substantially. But as soon as they try and withdraw funds, problems begin.

According to the FOS, some victims have ended up losing tens of thousands of dollars — and in some extreme cases, this has risen to hundreds of thousands of dollars.

Interim chief executive and chief ombudsman Nausicaa Delfas is urging consumers to be wary of investment schemes that look too good to be true, adding:

"We are concerned that, in current economic circumstances, people could be tempted to invest in fake investments."

Heartbreaking Tales

Last month, we told you the story of a British man who deposited $24,000 into one of these fraudulent cryptocurrency platforms — and was later told that his investment was worth just $23.16.

The scammers had suggested that he should embark on a lawsuit in an attempt to recoup the lost funds — but told the man he needed to send another deposit in order to fund the legal action. When he attempted the transaction, red flags went up at his bank and his account was frozen.

Once he went into a bank branch in an attempt to get the account reopened, staff began to realize what happened and the police were called. But tragically, detectives said:

"The victim is absolutely convinced the investment company is genuine, as initially, his investment doubled and the litigation was absolutely necessary to get his money back! Neither the bank, nor the police, were able to convince him this was a scam!"

But it isn't just consumers who know nothing about cryptocurrencies who are vulnerable.

Yesterday, a high-profile Crypto Twitter account revealed that they managed to swindle $100,000 from followers by advertising a fake investment scheme.

Fat Man Terra declared that it is "far too easy to scam people in crypto" — not least because "crypto bros are far too gullible and trusting for their own good." Stressing that those who sent him Bitcoin have now received a full refund, he added:

"I want to send a clear, strong message to everyone in the crypto world — anyone offering to hand you free money is lying. It simply doesn't exist. Your favorite influencer selling you quick money trading coaching or offering a golden investment opportunity is scamming you."
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