Americans lost a total of $5.6 billion in cryptocurrency-related scams in 2023, according to a new report from the FBI. The report details how scammers used sophisticated tactics to build trust with victims, convincing them to invest in fraudulent cryptocurrency schemes.
The FBI’s criminal investigative division, led by deputy assistant director James Barnacle, revealed the growing impact of crypto scams. Fraudsters often establish online relationships with victims before luring them into fake investment opportunities.
The report, released on Monday, outlines the losses incurred over the course of 2023. Throughout the year, the FBI has been working to raise awareness and prevent these scams from proliferating.
The scams are widespread across the United States, with a particular focus on older individuals. The report found that Americans over 60 were the most targeted demographic, collectively losing nearly $1.6 billion in these fraudulent schemes.
Scammers exploit the excitement around cryptocurrency as a lucrative investment, convincing victims that they can achieve high returns. Using fake identities and building online friendships, fraudsters create a false sense of trust. Eventually, they offer victims access to bogus web apps to “invest” in cryptocurrency, leading to significant financial losses.
Fraudsters convince victims to deposit money into fake crypto investment platforms or direct them to use cryptocurrency kiosks to transfer funds to scammer-controlled wallets. Some victims are persuaded to withdraw money from retirement accounts or take out loans, resulting in devastating financial consequences. Many older individuals, including those living in nursing homes, have been manipulated into these scams.
In response, the FBI is working to train local law enforcement and financial institutions to spot the warning signs of crypto fraud. The agency has notified 3,000 people this year that they were victims, with 75% of them unaware they had been scammed. Despite these efforts, recovering the stolen money remains highly unlikely, and many scams go unreported.
The FBI stresses the importance of vigilance as scammers continue to target vulnerable populations with these elaborate fraud schemes.
