Crypto Scams Will Increase Over the Holidays – Here’s How to Avoid Them

Every year as the holidays come around we also have to be on the lookout for potential scammers trying to ruin the fun.

This is because scammers become more active during the holidays and target us while we are unwary.

So far in 2022, Australians have lost about half a billion dollars to scams, which is already significantly more than this time last year.

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The bulk of these losses — around $300 million — were related to investments or cryptocurrency fraud.

Investment scam 2019-2022. Recognition: scamwatch.gov.au

Researchers at Deakin University’s Center for Cybersecurity Research and Innovation surveyed recent victims of such scams. Here’s what they found.

Anyone can fall for a scam

“I was shocked and couldn’t accept that this had happened to me, even though I was very careful…I was stunned for a few minutes because it was a large sum of money,” said a 26-year-old office manager from South Australia.

These scams have become very sophisticated and criminals are less selective about who they target. This is reflected in recent victim demographics, which show a wide variety of backgrounds, a more even spread across multiple age groups, and an almost even split by gender.

Age groups of fraud victims. Recognition: scamwatch.gov.au
Gender distribution for reported scams. Recognition: scamwatch.gov.au

So how can you spot these scams and where can you get help if you are a victim?

If it sounds too good to be true, it might just be a scam

“I was stunned to say the ground beneath my feet would be an understatement, it will take a very long time to recover from this, financially and mentally,” said a 36-year-old Victorian barrister.

Most crypto scams trick the victim into buying cryptocurrency and sending it to the criminal’s account for what appears to be a legitimate investment opportunity.

Cryptocurrency is the currency of choice for this type of crime as it is unregulated, untraceable and transactions cannot be reversed.

Victims of such scams are targeted using a number of different methods, including:

Investment Fraud: Scammers pretend to be investment managers claiming high returns on crypto investments. They trick the victim into transferring money and fleeing with them.

Pump and Dump: Scammers usually exaggerate a new cryptocurrency or NFT project and artificially inflate its value. Once enough victims have invested, the scammers will sell their stake, leaving the victims with worthless cryptocurrency, or NFT.

Romance Scam: includes scammers using dating platforms, social media or direct messages to contact you, gain your trust and offer an amazing investment opportunity that promises high returns or ask for cryptocurrency to cover medical or travel expenses.

Phishing scam: An old but still effective scam using malicious emails or messages with links to fake websites promising huge returns or just stealing credentials to access users’ digital wallets.

Ponzi Schemes: a type of investment scam in which scammers use cryptocurrency collected from multiple victims to repay high interest rates to some of them; When victims invest more money, scammers escape with all investments.

Mining Scam: Scammers try to convince victims to buy cryptocurrency in order to mine more of it, when in reality there is no mining – the scammers only make transfers that look like returns on the investment. Over time, the victim invests more and scammers continue to take everything.

Although methods evolve and change, the telltale signs of a potential scam remain relatively similar:

  • very high returns with promises of little or no risk
  • proprietary or secret strategies to gain an advantage
  • Lack of liquidity, which requires a minimum accumulation amount before funds are released.

Where to seek help if you have been scammed

“I felt helpless, I didn’t know what to do, who to turn to, I was too embarrassed and constantly blaming myself,” said a 72-year-old Victorian accountant.

If you think you’ve fallen victim to one of these scams, here’s what you need to do next:

  • Tell the Australian Competition and Consumer Commission or contact the relevant authorities as instructed on the ScamWatch website
  • contact your friends and family members and tell them about the scam; You can also be a source of help and support at such times
  • Because these events can have a psychological impact, it is recommended that you speak to your GP, healthcare professional or someone you trust
  • You can also turn to counseling services like Lifeline, Beyond Blue, Suicide Call Back Service, Men’s Line and more for help and support.

If you ever find yourself in a difficult situation, remember that help and support are available.

Finally, to avoid becoming the next stat during the holiday season, consider the following advice:

  • Do not give out your personal information to anyone online or over a phone call
  • don’t invest in something you don’t understand
  • When in doubt, speak to an expert or search for resources online yourself (don’t believe any links the scammers send you).

This article first appeared in The Conversation.

Authors: Ashish Nanda, Jeb Webb, Jongkil Jay Jeong, Mohammad Reza Nosouhi, Syed Wajid Ali Shah.

Watch: Woman dangles from window in east Manhattan apartment fire

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https://7news.com.au/business/cryptocurrency/crypto-scams-will-increase-over-the-holidays-heres-how-you-can-avoid-them-c-8848649 Crypto Scams Will Increase Over the Holidays – Here’s How to Avoid Them

James Brien

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