May 21st, 2024

Police see rise in cryptocurrency-related frauds as locals lose more than $800,000 this year


By Alejandra Pulido-Guzman - Lethbridge Herald on December 9, 2021.

LETHBRIDGE HERALDapulido@lethbridgeherald.com

The Lethbridge Police Service is warning the public to be cautious after an increase in cryptocurrency-related frauds.
 “We had very few previous reports of frauds, however, this year we are seeing an uptake in that. We investigated multiple complains with over 18 victims, where local residents have been defrauded over $800,000,” said Sgt. Kevin Talbot with the Economic Crimes Unit of the Lethbridge Police Services on Wednesday.
Talbot said the cases have ranged from investment scams, where victims have been promised exceptionally high returns and are initially allowed to make small withdrawals to entice victims to invest more. But eventually victims lose their entire investment, sometimes their entire life savings.
Talbot said other cases involve more traditional scams, involving social media platforms, email, text messaging and phone calls. Often victims are told they owe taxes to the Canada Revenue Agency, or they have warrants for their arrest and must immediately deal with it, by converting their money into cryptocurrency and sending it to the scammer.
 Cryptocurrency is a digital asset used as a medium of exchange. Unlike the Canadian or US dollar, there is no central authority that manages and maintains the value of cryptocurrency. Strong encryption is used to secure transaction records and technology, called blockchain, a decentralized ledger of all transactions. The encryption makes the transfer of cryptocurrency difficult to trace, providing fraudsters with protection and anonymity from their victims.
 Bitcoin was the first cryptocurrency but there are now thousands in circulation used to legally purchase products, services and for investment purposes, as values fluctuate with demand, similar to the stock market.
 “With frauds involving cryptocurrencies expected to continue to increase worldwide, we are advising the public to be wary of common scams, and always exercise due diligence before any money or cryptocurrency changes hands.  Remember, if something sounds too good to be true, it is,” said Talbot.
Talbot said they received two reports of scams where local residents were victimized by callers claiming to be a Lethbridge Police officer asking them for payment in Bitcoin. The first one involved a local resident being told their credit card had been compromised and were asked to withdraw cash from their bank account and deposit it into a Bitcoin machine to keep their money safe. They complied and lost $450.
The second scammer also claimed to be an LPS officer and told the resident they had a warrant for their arrest out of Quebec and convinced them to pay $5000 in Bitcoin.
Talbot said in both cases the calls appear to come from a legitimate police complaint line. He said that unfortunately scammers can use technology to spoof a phone number, to make it appear as if it was coming from a legitimate source, such as their police agency.
“Never use your call display to confirm the person is a police officer. If you are in doubt, call us directly at 403-328-4444 to confirm we need to speak to you,” said Talbot.
Talbot said as a reminder, that police or any other government authorities will not request people’s banking details. They will not call requesting money, gift cards or cryptocurrency, to vacate an arrest warrant or for any other services they provide.
Talbot said people who want or need more information about fraudulent scams and how to protect themselves, should visit https://www.antifraudcentre-centreantifraude.ca
Talbot explained they are taking steps to improve their capacity to investigate these types of crimes, specifically involving cryptocurrency.
“I wouldn’t say it is new, but it’s a trend we are starting to see that we need to address at some point in time. So we are taking steps to prepare for that and we are hopeful we’ll get to a point where we can help a lot more,” said Talbot.

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jenniferdehner9

Thanks for this information.