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If you dabble in cryptocurrency, it’s best to be extra vigilant if you receive a random message that purports to be from a trading app. Fake crypto app scams are proliferating, the FBI warns, and scammers are making off with millions.
A new report from the FBI said that 244 Americans have been robbed of an estimated $42.7 million by cybercrooks promoting fake crypto apps.
The agency is advising financial institutions as well as individual investors to be vigilant. They say crooks have had “increasing success” siphoning away unsuspecting investors’ cryptocurrency.
Stealing a few logos and setting up a website that mimics a well-known financial company is an old trick, and crooks today are using this scheme to swindle people out of crypto. In April, cybersecurity website KrebsOnSecurity posted about a crypto-related scam that used the name of famous portfolio manager Cathie Wood and her investment firm ARK Invest to direct victims to a fake website in order to defraud them with the promise of a cryptocurrency “giveaway.”
Now, you have to watch out for fake mobile apps as well as fake websites.
The FBI says criminals often steal brand names, logos and other identifying information of real crypto trading platforms or financial institutions, then create fake apps intended to trick you into thinking you’re doing business with the real thing.
In one case, more than two dozen people were fooled by a fake that looked like a legitimate trading platform (the FBI didn’t specify which one) and were convinced to deposit cryptocurrency into “wallets” there. The victims found out they had been dealing with an imposter when they tried to make withdrawals and couldn’t do so. The scammers made off with $3.7 million in that case.
In other cases, cybercriminals have used names of defunct or overseas financial services platforms to trick unaware investors into thinking that they were dealing with legitimate enterprises.
The common thread is that all the victims were convinced to download a mobile app that turned out to be a Trojan horse, which means cryptocurrency traders should be cautious about any mobile apps they download.
Here are some tips the FBI recommends to help you avoid getting suckered into a crypto app scam:
If you think you’ve been swindled by a fake app, you can contact the FBI via a local field office or the Internet Crime Complaint Center.
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Beware New Crypto App Scams: FBI Says Investors Have Lost Millions – money.com
