Americans were scammed out of billions last year—and crypto is very much to blame.
According to a report by the FBI on Monday, Americans lost more than $5.6 billion due to cryptocurrency scams in 2023. That makes up just under half of all total losses from financial fraud in the US last year—and a shocking 45 percent increase in crypto scam losses compared to 2022.
Investment scams were responsible for nearly 71 percent of all cryptocurrency scams, totaling an almost $4 billion loss. Bad actors also used call center frauds, government impersonation scams, and dating sites to swindle people out of their crypto.
“Over time, the victim is being cultivated, and the fraudsters are building confidence in the victim,” said James Barnacle, the deputy assistant director of the criminal investigative division at the FBI, to ABC News. “They’re friends. They met on the internet, or they met on social media. They’ve met on text message. They develop a friendship, then the fraudster will offer an investment opportunity, and the pitch is something along the lines of like, ‘Hey, I’m in a group that does investments or I know someone that does investments in cryptocurrency.’”
In the FBI’s report, Michael D. Nordwall, Assistant Director of the FBI, attributes “the decentralized nature of cryptocurrency, the speed of irreversible transactions, and the ability to transfer value around the world” for its popularity among scammers.
Nordwall said he hopes the report will “bring attention to the proliferation of losses linked to cryptocurrency-related fraud, bolster awareness of the most prevalent schemes utilizing cryptocurrencies, and educate the public on the ways to protect themselves against these kinds of frauds.”
Interestingly—since crypto is more popular with Gen Z and millennials—the people scammed the most were in the over-60 age bracket. Over-60s reported filed nearly 17,000 crypto-related complaints and lost out on more than $1.6 billion. For comparison, people ages 20 to 29 filed about 6,200 complaints but lost only one-tenth as much, with a still-disgusting total of $168,585,320.
“Elderly have generally a lot more free time,” Barnacle said. “They’re at home, they’re in an assisted living facility, and so they’re pretty easy to target, in that sense, just their availability is higher than someone who’s not at home all day. And the fraudsters are really good at building that rapport.”
The most victimized state was California—with more than $1.1 billion in losses—followed by Texas, Florida, New York, and New Jersey.
As for how to prevent yourself from becoming one of the many, the FBI encourages people to research the origin of any suspicious calls, refrain from giving out personal information to unknown parties, verify email addresses that purport to come from banks or governments, and be wary of get-rich-quick schemes. If you are scammed, you can report it to the FBI at IC3.gov.
Earlier this year, VICE News’ Natashya Gutierrez investigated an exploding crypto scam industry built on enslaved labor, gaining rare access to the human trafficking victims who were forced into stealing billions of dollars from everyday Americans.
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The post Crypto Scams Drained $5.6 Billion from American Wallets in 2023 appeared first on VICE.
