Almost every week, for the past year, people have been calling Patrola Law because they have been defrauded in one crypto scam or another. The lucky ones have lost a few thousand dollars; the unlucky ones are out hundreds of thousands of dollars. Some of these individuals will be losing their homes.
Cryptocurrency is an exciting new world of investments and new ventures but it is rife with fraud artists.
We are seeing many people who have been fleeced of their hard-earned money by individuals they've met on dating websites. Numerous victims - all men - have contacted our office with similar stories.
All such fraud has followed a similar blueprint, as outlined below:
1. victim meets the fraud artist on some online dating website or other;
2. victim never meets the fraud artist in person;
3. victim grows emotionally attached to the fraud artist or is emotionally manipulated by the fraud artist;
4. the fraud artist convinces victim to invest in a supposedly lucrative cryptocurrency fund or project, or trading account;
5. the fraud artist instructs victim to convert his/her fiat (legal tender, such as Canadian dollars) into Bitcoin (or some other coin) via Shakepay (or some other legitimate exchange), then instructs victim to:
a. transfer the Bitcoin to another exchange, where the Bitcoin is traded for some other form of cryptocurrency and then transferred to an exchange, platform, or wallet (the “Fraudulent Platform”) controlled by the fraud artist; or
b. transfer the Bitcoin directly to theFraudulent Platform;
6. a fake account (the “Fake Account”) is opened for the victim on the Fraudulent Platform, and victim is led to believe they have control over their monies/cryptocurrency;
7. the Fake Account shows significant profits being generated over a short period of time;
8. the victim is pressured to invest more monies;
9. when the victim tries to withdraw funds or cryptocurrency from the Fake Account, they are unable to do so;
10. the victim is advised they will need to pay a high-percentage tax/fee (the “Tax”) in order to withdraw funds from the Fake Account, often times 30% of so-called profits showing in the Fake Account; and
11. after victim pays the Tax, they are still unable to withdraw their monies/cryptocurrency and/or their account on the Fake Platform is locked or closed, and the Fraud Artist stops communicating with the victim unless it is to pressure them to invest more monies.
To date, all of the victims who have contacted our office have informed us that the fraud artists are alleging to be: (i) Chinese; and (ii) living in China, Taiwan, Malaysia or Singapore. It is likely these fraud artists are operating in sophisticated groups, perhaps call-centers, to perpetrate this type of cryptocurrency fraud.
If you have met someone on an online dating site, and he/she tries to convince you to invest in some cryptocurrency project or other, there is a good chances it's fraud. Please exercise caution.