It's been a pretty ordinary few weeks for cryptocurrencies and cybersecurity.
In Australia, millions of consumers have had to deal with the theft of their private information from Medibank Private Ltd (ASX: MPL) and Optus.
Globally, the finance industry has been left bemused — and distressed — at the collapse of giant crypto exchange FTX.
While these issues are front-of-mind, the Australian Securities and Investments Commission this month warned Australians to be vigilant about crypto scams.
According to ASIC deputy chair Sarah Court, Australians lost in excess of $710 million from investment fraud in 2021, which was a shocking 135% higher than the previous year.
"The main driver of the increase was cryptocurrency investment scams, where losses increased by 270%," she said.
"The ACCC have advised that losses to crypto scams have increased further in 2022."
Image source: Getty Images
If you're in one of these 10 situations, watch out
The corporate watchdog stated crypto scams fall into one of three broad types:
- Scams where the investor thinks they're putting money into a genuine asset, but the app, exchange or website is fake
- Scams selling fake crypto tokens to steal your legitimate cryptocurrency (like Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH)) in return and crypto trading jobs that are just facilitating money laundering
- Scams that use digital assets to make a payment
So how can you tell if something is a scam?
ASIC has published 10 signs that likely mean you're dealing with a criminal trying to steal money or data.
Be very suspicious if one or more of these things happen to you:
- You receive a golden offer or opportunity just out of the blue
- You see a faked celebrity endorsement
- A romantic interest you only know online starts asking for crypto
- You're pressured to transfer crypto from your current wallet or exchange to another site
- You're directed to pay for a financial service using crypto
- The app you're about to install isn't available on Google Play or the Apple Store
- You have to pay a fee to access your own money
- You are guaranteed a certain level of returns or offered free money
- Unfamiliar digital tokens land in your digital wallet
- The exchange withholds investment returns for supposed "tax purposes"
Court implored those who suspect they've fallen for a scam to "act quickly".
"Don't send any more money. Block all contact from the scammer," she said.
"Do not delay. Contact your bank or financial institution immediately to report the scam. Ask them to stop any transactions. Also, warn your family and friends so they can watch out for potential follow-up scams."
The deputy chair reminded investors that financial loss is not the only cost when falling victim to such fraud.
"Scams cause emotional stress and can impact relationships."
More information on crypto scams can be found on ASIC's Moneysmart website. Crisis support is available through Lifeline on 13 11 14 and emotional support via Beyond Blue on 1300 22 46 36.
