Cryptocurrency scams on the rise and occurring across country, authorities say

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Victims young and old are falling for a get-rich-quick cryptocurrency scam that investigators are calling “pig slaughtering.” According to authorities, scammers fatten up their victims, getting as much as they can from them, before disappearing and often taking the victim’s life savings with them.

Investigators have said the scam usually starts with a call, text or message through a social media platform. The stranger builds trust with the victim before bringing up cryptocurrency and introducing them to an investment platform that someone the victim knows has been using with high-yielding results.

The victims then invest money into these websites, sometimes dropping their life savings, all with the hopes of the same promising return.

It’s exactly what happened to Lorena Brunson, a South Tampa bakery owner who found herself in a pinch and needed money. Her son had been investing in cryptocurrency through a website he was introduced to on Instagram. He’d seen his investments triple, so Brunson decided to invest too.

READ: South Tampa bakery to close after online ‘investor’ disappears

She put in $4,000 to start, turned a profit, and was able to withdraw it. After two months, she’d invested $80,000 of her own money with her crypto balance having grown to nearly $180,000. However, when she tried to cash out, she was told she’d have to pay $62,000 in taxes before she could access her money.

The person Brunson had been communicating with eventually disappeared, taking all of her investments with them. 

Investigators have seen an uptick in these scams and have said this is usually how it goes. In 2021, the FBI received 4,300 complaints, totaling over $425 million dollars in losses.

“Although it’s yet to become a mainstream payment method, reports to the FTC show it’s an alarmingly common method for scammers to get peoples’ money,” according to the Federal Trade Commission. “Since the start of 2021, more than 46,000 people have reported losing over $1 billion in crypto to scams – that’s about one out of every four dollars reported lost, more than any other payment method. The median individual reported loss? A whopping $2,600.”

According to authorities, the best way to avoid this scam is to do your research on the investment platform or website in question to make sure it’s legit. However, if a stranger is introducing this platform to you, there’s no reason to trust them because chances are they don’t have your best interest in mind.

The FTC provided the following ways to avoid cryptocurrency scams:

  • Only scammers demand payment in cryptocurrency. No legitimate business is going to demand you send cryptocurrency in advance – not to buy something, and not to protect your money. That’s always a scam.
  • Only scammers will guarantee profits or big returns. Don’t trust people who promise you can quickly and easily make money in the crypto markets.
  • Never mix online dating and investment advice. If you meet someone on a dating site or app, and they want to show you how to invest in crypto, or asks you to send them crypto, that’s a scam. 

You can learn about the different types of cryptocurrency scams by heading to the FTC website: consumer.ftc.gov/articles/what-know-about-cryptocurrency-and-scams.