Table of contents:
- Type of scams
- How do scammers reach out to you
- How to protect yourself from theft and scams
- What to do when you think you are being scammed
Scammers are always looking for new ways to trick people into parting with their money. Bitcoin and other cryptocurrencies such as USDT have become increasingly popular choices for many crypto investors. Unfortunately, this has also made them primary targets for thieves looking to take advantage of them. The number of scams is rising as they become ever more sophisticated.
Note: Almost all scams promise quick and substantial returns, pressuring you to act fast by playing on your fear of missing out (FOMO).
Type of scams
Investment scams
Investment scams often promise high returns with little risk, using high-pressure tactics to create a sense of urgency. Scammers may exploit your trust by providing fake testimonials. Common red flags include claims of ‘low-risk’ investments with guaranteed returns, and offering to ‘help’ you set up the investment process.
Note: Scammers advertise “investment opportunities” by sending unsolicited messages or adding victims to chat groups on messaging platforms such as FB Messenger, WhatsApp or Telegram.
Money Mules
Criminals often use fake job advertisements that promise easy money for simple tasks like transferring funds to recruit money mules. They may exploit social media or dating sites, posing as friends or romantic interests to build trust before requesting assistance. Scammers create urgency and pressure, encouraging quick decisions while providing vague explanations about the work and the source of funds. Promises of compensation, often a percentage of the transferred amount, make the offers seem attractive.
Note: Singapore takes a strong stance against money mules and money laundering. Offenders may face severe penalties.
Phishing scams
Phishing scams trick you by sending fake emails or messages on apps like WhatsApp or Telegram that look real. They will get you to click a link that takes you to a fake website or app. Once there, you’re asked to enter your login details or connect your crypto wallet, which will then give scammers access to your crypto. These scams are hard to spot because the fake websites and emails look almost exactly like the real ones.
Fake websites
Scammers often create fake crypto trading sites or imitate popular crypto app or wallets to trick unsuspecting users. These fake sites often have minor differences, like a single letter change, making them hard to spot at first glance.
Fake crypto sites usually operate in two ways:
- Phishing pages are fake websites that trick people into giving their account details. They often come through links in emails or show up in Google or Yahoo search results.
- Direct theft: At first, the fake site lets you make small withdrawals to gain your trust. Once you start putting in bigger amounts or try to withdraw your funds, the scammers give fake excuses, like government taxes, to make you add more money. Ultimately, the site shuts down and steals all your funds.
Rug pulls / “Pump & Dump” schemes
A “rug pull” happens when the developers of a crypto project suddenly take all the money and disappear, leaving you with nothing. These developers are often anonymous and rarely caught, so the stolen money is usually gone forever. A “pump and dump” is when a new token is heavily promoted online, often by influencers or fake celebrity endorsements, to get people to buy in. The price goes up quickly, and then the scammers sell all their tokens, causing the price to crash, leaving you with losses.
How do scammers reach out to you
- Fake job ads lure you with promises of easy money for simple tasks like transferring money or crypto in exchange for a commission.
- Fake friend scall scams: Scammers contact you through phone or messaging platforms, pretending to be someone you know and trick you into sharing personal information or sending money.
- Love scam: Scammers use fake identities to befriend you and gain your trust
- SMS or messaging platforms:
- Telegram
How to protect yourself from theft and scams
If you’re asked to send Bitcoin or crypto for investment purposes with the promise of high returns, it’s a scam. 100% of the time.
Note: Please note that cryptocurrency transactions cannot be reversed. Independent Reserve cannot assist you to recover any funds or crypto.
Common traits of scammers:
- Requesting payment in Bitcoin or other cryptocurrencies instead of traditional currencies like Singapore or US dollars.
- Asking for a small amount of money initially, then requesting larger sums.
- Frequently calling or pressuring you to invest more.
- Using fear of missing out (FOMO) to push you into quick investments.
- Promising guaranteed returns or unusually high payouts.
- Using websites or social media accounts with spelling or grammatical errors.
- Initiating contact through Direct Messages, offering to “help” with a problem.
- Making bold claims without providing detailed explanations or evidence.
How to protect yourself?
- Never share your account login information or access to your Singpass with anyone.
- Never ever share your private key or seed phrase to your wallet with anyone.
- Always enable 2-factor authentication (2FA) to add an extra layer of security to all your online accounts.
- Never trust anyone who contacts you directly to ask for payments in crypto, or offers to “help” you with an issue. If someone contacts you first, it is almost always a scam.
- Always double-check to confirm a website URL is legitimate before connecting your wallet or entering your personal details.
- Do not click on any email links unless you have verified their authenticity.
- Do not download any apps or browser extensions unless you have verified they are legitimate.
- Reject any offer that requires an upfront payment, especially if that fee has to be paid in crypto.
- Do not visit sites through links in Google searches, in case you click on a fake site. Always check the URL of the site before entering your login details or personal information.
- Do not take any information at face value. Always do your own research and get as much information as you can from official sources, before investing in any cryptocurrency project or crypto-related offering.
- Be aware that cryptocurrency prices may fluctuate greatly, so you should only invest money you can afford to lose.
What to do when you think you are being scammed?
- Stop all communication with the suspected scammer to prevent further manipulation.
- Do not put in more money.
- Keep records of all interactions, including messages and transactions, as this information is crucial for investigations.
- Report the scam to the police.
- Contact us immediately to freeze and restrict your account.
Note: Remember, if it seems too good to be true, it often is.
