The Guelph Police Fraud Unit is reporting an increase in cryptocurrency investment scams and is warning its residents to beware.
This is not a localized scam, and other major cities and jurisdictions have been hit as well.
There have been reports of victims being contacted through social media platforms where the suspect will convince them to make investments in cryptocurrency through online transactions, generally through a third-party site. The suspect is very well versed and knowledgeable in cryptocurrency and makes promises of large returns on investments.
Though cryptocurrency can be a means of legitimate investing, fraudsters have capitalized on the inexperience of the public and are utilizing several fraudulent online platforms to appear legitimate to the unsuspecting victim. They direct the victim to a site that appears legitimate, and once logged in with a username and password, the victim can watch their investment grow at an astonishing rate. This leads the victim to want to invest more and more, making their loss that much more substantial.
Once the victim tries to withdraw the funds or use their “earnings” to make further investments, they are told that they cannot and that they are locked in unless they make an additional substantial investment of their own funds. It is at this time that the fraudster will either cease communication with the victim, or will try to delay them in making withdrawals by telling them that they agreed to the terms of the investment and that if they don’t invest further they will lose everything that they have already invested.
Once the money is transferred into the account it is immediately transferred out or used to make further transactions that are then accessed and transferred around the globe.
Warning signs it’s most likely a scam:
- Brokers use non-traditional means to contact you, such as the WhatsApp texting app, Facebook, etc.;
- The website they direct you to only has email or a site-based chat as a means of contacting them;
- The investor contacts you by using a variety of email addresses and phone numbers;
- The text messages and reports contain grammar or spelling mistakes;
- Their introduction will be inaccurate; for example, referring to you by your first name, i.e. Mr. John instead of Mr. Smith;
- The promise of large returns on your investment (150-200% returns per investment). If it sounds too be good to be true, it probably is;
- The scammer may use a romantic angle to gain your trust;
- They may allow you access to their own username on the fraudulent site then direct you how to invest and show you just how much money you could be earning;
- There may be translations from other languages within the email
- Be very leery of people contacting you on social media who, within a short period of time ask you to invest with them or begin discussing how much money they are earning with their investments and how you too could make a lot of money if you follow their directions.
Always do your research on any company that you are going to invest with. Generally, there aren’t too many curtains you have to look behind before you are able to see that fraudulent company is not legitimate.
Check potential investment brokers through the Better Business Bureau and ask for references.
