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Tuesday, May 28, 2024

Dating apps are the next target for cryptocurrency scammers

Tho Vu was looking for a guy on the dating app Hinge, and he found one that checked all of her criteria.

The man in question was a boyishly gorgeous architect from China who had been sent to Maryland on a long-term basis. Despite the fact that they had never met in person — he was still waiting for his Covid-19 booster dose, he said — they had been texting back and forth for months, and she had formed a strong romantic interest in him. He addressed her as his “little sweetie,” and he informed her that, after the epidemic was over, he intended to take her to China to meet his family.

As a result, when the guy, who went by the name Ze Zhao, approached Ms. Vu, who works in customer service for a security business, and told her that he could assist her in making money by trading Bitcoin and other cryptocurrencies, she was really interested.

The guy, on the other hand, was not attempting to assist Ms. Vu in investing her money. His scheme, she said, included entrapping her in a form of financial fraud that was becoming more popular, one that combined the age-old appeal of romance with the more recent temptation of instant cryptocurrency wealth.

Ms. Vu, 33, had wired more than $300,000 in Bitcoin, practically her entire life savings, to an address that Mr. Zhao had informed her was linked to an account on the Hong Kong cryptocurrency exchange OSL within a few weeks of receiving the information from him. The website seemed to be real, provided 24/7 online customer service, and had even been updated to show Ms. Vu’s balance fluctuating in response to fluctuations in the price of Bitcoin.

Romance scams, which are internet frauds in which a perpetrator pretends to be interested in a victim in order to win their confidence, have risen in number as a result of the epidemic. The same may be said for cryptocurrency pricing. As a result, cryptocurrency has become a convenient entry point for thieves trying to drain victims’ savings accounts.

According to statistics from the Federal Trade Commission, around 56,000 romantic scams were filed to the agency last year, resulting in losses of $139 million. This is almost double the number of reports received by the agency in the previous year. Earlier this year, the Federal Bureau of Investigation’s Oregon branch issued a statement warning that crypto dating scams were rapidly becoming a significant category of cybercrime, with more than 1,800 documented incidents in the first seven months of the year.

It is believed by experts that this specific form of fraud began in China and then expanded to the United States and Europe as a result. Because of the manner victims are “fattened up” with flattery and romance before being conned, the scam’s Chinese term translates approximately as “pig slaughtering.”

In contrast to traditional romance scams, which typically target older, less tech-savvy adults, Jan Santiago, the deputy director of the Global Anti-Scam Organization, a nonprofit that represents victims of cryptocurrency scams, said that these scammers appear to be targeting younger and more educated women on dating apps such as Tinder, Bumble and Hinge.

From there, the fraudster bombards the victim with amorous messages until the subject of cryptocurrencies is brought up. The fraudster, acting as a professional cryptocurrency trader, promises to teach the victim how to invest his or her money in order to make quick, low-risk rewards on cryptocurrency investments.

The fraudster then assists the victim in purchasing bitcoin on a reputable website, such as Coinbase or Crypto.com, and offers instructions for transferring the cryptocurrency to a fictitious cryptocurrency exchange, according to Ms. Lee. Following this, the victim’s money appears on the exchange’s website, and he or she begins “investing” it in different cryptocurrencies, under the fraudster’s instruction, until the scammer eventually absconds with the money.

A major factor contributing to the sophistication of this specific fraud as compared to other Nigerian prince scams is its complex nature. Some victims have reported that they were sent to websites that seemed authentic, complete with charts and tickers that displayed the values of different crypto assets. The names and locations of the fictitious exchanges are constantly altered, and victims are frequently let to withdraw modest quantities of money early on, allowing them to feel more comfortable investing greater sums later on in the process.

Scammers find cryptocurrency to be especially valuable because of the relative seclusion it provides, according to industry experts. Despite the fact that Bitcoin transactions are publicly available, technically adept criminals may conceal the trail of money by using digital wallets that are not linked to any one person. Furthermore, since there is no central bank or deposit insurance to compensate victims, stolen money is almost always unable to be retrieved.

She couldn’t believe how simple it had been to generate money just by following Hao’s advise. She wished she had done it sooner. Eventually, when she had invested all of her resources, she took out a loan and continued to make further investments.

She became suspicious when she attempted to withdraw money from her bank account in December, according to Ms. Hutchinson. After the transaction failed, she received a call from an ICAC customer care representative who informed her that her account would be blocked until she paid hundreds of thousands of dollars in back taxes. Her conversation with Hao came to a halt.

Ms. Hutchinson does not expect to get her money back, but she hopes that by sharing her storey, other people would be more careful when dealing with strangers who claim to be able to assist them in investing in cryptocurrencies.

Jonathan James
Jonathan James
I serve as a Senior Executive Journalist of The National Era
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