Crypto romance scams on the rise in US, FTC warns: Details
The United States Federal Trade Commission (FTC) has noted a rise in romance scams targeting the crypto community in the US. The FTC has clearly asked people to stay away from online love interests who may be discussing investment ideas with them, particularly related to cryptocurrencies and other digital assets. The trade regulator has reminded people that no one can guarantee a certain profit on crypto investments, given the volatile nature of these assets.
This week, the FTC issued an official warning about the rise of cryptoromance scams. In this category of scams, fraudsters contact potential victims via dating apps under the pretense of starting a romantic relationship. After gaining the trust of their targets, these scammers lead their victims to invest in shady or fake crypto assets with the promise of high returns. After securing the required investments, these scammers typically disappear, leaving their victims empty-handed.
“No one expects their online love interest to scam them, but scammers are good at what they do. They build an emotional connection with you, making you believe they’re an expert in, say, cryptocurrency investing. But that online love interest is a scammer. People have lost tens of thousands — sometimes millions — of dollars to romance scammers,” the FTC said. wrote in her official blog post on June 10.
As part of this rising crypto fraud, the FTC has warned users against promises of risk-free investments and unconventional methods of transferring money online. The financial watchdog has further noted that people should definitely not trust strangers who teach them how to invest in cryptocurrencies.
“If you think someone you met on social media is a scammer, cut off contact, tell the social media platform, and then tell the FTC,” the blog added.
However, this is not the first time that romance scams have been listed as a dangerous category leading to huge financial losses. In February this year, a 37-year-old Indian woman currently residing in Philadelphia, USA, Reportedly lost $450,000 (approximately Rs 3.7 crore) in a cryptocurrency romance scam.
In the same month, Australia’s National Anti-Scam Centre Reportedly warned citizens to be extra cautious against romance scams that have resulted in losses of over USD 40 million (approximately Rs 335 crore) by 2023.
According to the FTC: “It all starts with someone reaching out to you — seemingly at random — on social media. But they’ve done their homework, looking at your profile and other information on the platform. They want to help you invest your money in the crypto markets, or they say they can teach you how. You might think they have your financial well-being in mind, but they don’t.”
In March 2024, the FBI claimed that crypto investment fraud had increased by 53 percent in the previous year. Many countries around the world are now accelerating their efforts to implement regulations to monitor the crypto sector and impose penalties on criminals who make the sector unsafe for innocent investors. The UAE is one of the first countries to set definitive rules on the penalties for crypto scammers, which include prison sentences of up to five years and a fine of AED 1 million (approximately Rs. 2 crore).
