A leading high street lender has issued a warning to social media users about the dangers of cryptocurrency fraud, predicting a significant increase in celebrity-endorsed scams in 2022. According to Santander, there has been a 61% rise in the number of cases of cryptocurrency fraud between Q4 2021 and Q1 2022, with the average cost of these scams increasing by 65% year-on-year to £11,872 in the first quarter.
The lender has projected an 87% increase in cryptocurrency scams by the end of 2022 compared to 2021 figures, with many users falling victim to fraudulent schemes due to fake celebrity endorsements circulating online. These scams often involve crypto ads being posted on social media, legitimate websites, or online search listings, enticing users to invest in fake opportunities with promises of high returns and low risk.
Once users provide their personal information, scammers contact them via phone, email, or social media messages, using aggressive sales tactics to pressure them into investing. After the money is deposited, scammers freeze the account and steal the funds, gaining access by tricking victims into downloading remote access Trojan (RAT) software to hijack their computers.
Chris Ainsley, head of fraud risk management at Santander, emphasized the importance of thorough research before investing in any opportunity, regardless of who is endorsing it. He warned against falling for the promises of high returns, as many individuals have lost significant amounts of money to these sophisticated criminals.
Daniel Holmes, a fraud expert at Feedzai, highlighted the need for collaboration among industry stakeholders to combat the rise in cryptocurrency scams. He stressed the importance of user awareness, quick fraud detection by banks, and protection measures for crypto platforms to prevent becoming unwitting accomplices in fraudulent activities.
In conclusion, it is crucial for users to exercise caution and conduct thorough research before investing in any cryptocurrency opportunity. By staying vigilant and collaborating with industry partners, individuals can protect themselves from falling victim to fraudulent schemes and help safeguard the integrity of the emerging crypto market.