Stolen Identity of Barefoot Investor Used to Scam His Followers
Renowned Australian financial expert Scott Pape, known as the "Barefoot Investor," has unveiled his battle against crypto scammers who hijacked his identity to defraud his followers.
On 23 December, it was reported that Pape and his team had been tirelessly identifying and reporting hundreds of fraudulent Facebook groups exploiting his image to lure victims into scams.
Australian finance educator Scott Pape, also known as the "Barefoot Investor," has analyzed the tactics used in WhatsApp group crypto scams targeting Facebook users. pic.twitter.com/iKV3Ydq0Cu
— Tracey Van 💎 (@gemtracer) December 23, 2024
Pape Took Matters Into His Own Hands & Engaged with the Scammers
Determined to expose crypto scammers, Pape chose to engage with them rather than wait for Facebook to remove their fraudulent groups, which risked further spread of their schemes.
Using a fake Facebook profile, he sought investment advice from the scammers.
Within hours, they solicited his phone number and invited him to join an "exclusive" WhatsApp group called the "DB Wealth Institute.”
Intrigued, Pape searched for the institute online, uncovering automated press releases on platforms like Yahoo Finance, Forbes, and LinkedIn.
One of the many false groups using Pape's name
One release described the "DB Wealth Institute," allegedly founded in 2011 by "Professor Cillian Miller," as offering financial training and boasting the development of "AI Financial Navigator 4.0," a tool integrating AI and big data to refine trading strategies.
By 2024, it claimed to have trained over 30,000 students across more than ten countries.
He noted:
“At 11 am each day, the Professor would give his trading signals. You were encouraged to post screenshots of your winnings in the WhatsApp group, which people did all day and all night. I suspected they were bots.”
Pape described how his phone quickly flooded with over 200 daily messages in the WhatsApp group, as users shared their supposed successes in crypto trading.
He was then approached by an assistant named "Ally," who advised him to take a high-risk 100X long trade on an altcoin using the "trade signals" provided by the alleged professor.
Following the advice, Pape saw an 81% profit in just 10 minutes.
However, after his initial success, the scammers swiftly escalated their tactics.
Ally bombarded him with hundreds of messages, probing how much he could invest and even urging him to take out a loan to join their exclusive investing programme.
At this point, Pape recognised the telltale signs of a scam, drawing on his past experience helping other victims.
He knew that this was a typical tactic used by fraudsters to reel in their targets, and decided to stop engaging before things escalated further.
Fake "Professor" Promoting Bogus Trading Signals
Pape's investigation revealed that US regulators and financial authorities had long warned about scams involving fake "wealth institutes" operating through platforms like WhatsApp.
These scams typically feature a supposed "professor" offering fraudulent trading signals to encourage investments, alongside an assistant who maintains communication with potential investors.
Once enough funds have been collected, the scammers vanish, often rebranding their operation and targeting new victims.
Pape explained:
“There are three steps that make up these scams: the first step is confidence. The second step is greed. And the final — and most lucrative of all for the scammers — is fear.”
