Romance scammers made off with a total of $139 million in cryptocurrency last year, five times more than the amount stolen in 2020, according to a new report from the Federal Trade Commission (FTC). The total amount of money lost through cryptocurrency payments made up the largest piece of the $547 million lost to scammers in 2021. On average, victims who paid via cryptocurrency lost $9,770.
Some scammers pretend to be “financial experts” who promise to invest their victims’ money
Romance scammers (whom we could probably also call catfishers) often create fake social profiles using pictures taken from the internet and then trick victims into sending them money, the FTC explains. They may claim to need money for some sort of financial crisis, but even more interestingly, some scammers pretend to be “financial experts” who promise to invest their victims’ money in cryptocurrency or the stock market.
While the most money was lost through crypto scams, easily purchased gift cards were the most commonly used payment method to carry out scams — 28 percent of victims paid their “lover” with one. A total of $36 million was lost to gift card-related romance scams, the FTC said, which is still significantly lower than the $139 million stolen in crypto. Victims also paid a total of $121 million through bank transfers and other forms of payments, and paid $93 million through wire transfers.
As the FTC notes, there are some red flags to watch out for that may indicate you’re being scammed; when anyone you’ve met online asks for payment in gift cards, crypto, or through wire transfer, it’s best to decline their request. And if you’re suspicious that someone may be catfishing you, just run their profile picture through a reverse image search to see if it’s been used elsewhere.
And remember that romance scams aren’t the only way fraudsters fool people into sending cryptocurrency. Last year, the FBI warned the public about a scam where bad actors convinced victims to put their cash into cryptocurrency ATMs and then sent newly purchased coins to the scammer via a QR code. In that scenario, scammers used promises of wealth or love, or impersonated financial institutions to reel in their victims.
Update February 16th, 3PM ET: Updated to further clarify that scams involving cryptocurrency resulted in the most amount of money lost, while gift cards were the most commonly used payment method to carry out the scam.