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The so-called virtual currency fraud is actually a fraud gang pretending to be fake exchanges and investors. and fraud involving the use of false projects to defraud property. Fraudulent groups take advantage of the popularity of virtual currencies and the public’s unfamiliarity with virtual currencies to carry out this series of fraudulent activities. As a result, various cases of virtual currency fraud emerge one after another.
So, what are the specific virtual currency fraud techniques? How can ordinary people avoid them? This article will analyze the common virtual currency fraud techniques on the market and how we can identify the correct information to avoid being scammed by virtual currency.
What are the common virtual currency fraud techniques?
1: Fake virtual currency exchange
Many are unknown small exchanges or fake exchanges. You may be able to transfer money to them, but the money can't come out. In fact, these are fake trading platforms. When you want to withdraw money, the fake exchange will ask you for more handling fees, margins, or 20% tax, or ask you to wait until the trading volume reaches US$10,000 before you can withdraw money, or threaten you to say that they No matter how much security deposit I have paid for you, they will come to find you at home if you don’t pay back the money. Generally, once you stop being defrauded of payments, these scammers will stop contacting you.
Do your homework before trading. Some well-known exchanges are easy to find on the Internet. Scam groups will also imitate well-known exchanges and make the appearance of the website or APP look like a normal exchange, which is very easy to confuse people.
Generally, counterfeit exchanges cannot be found on GOOGLE. They usually use dating apps or social groups. They also chat with you and get to know you better, then recommend you virtual currency exchanges and give you fake web links. , or use phishing websites to make you leak all your personal information, and then continue to defraud you of your money.
2: Ponzi scheme and ICO fraud model
The so-called ICO (Initial Coin Offering) means initial currency offering. The scam method is usually to tell you that a newly issued virtual currency is very profitable and only invite you to participate in the subscription. Scam groups usually use Line or FB groups, dating software or on-site briefing sessions to make friends with you or use briefing sessions to set up a show. They get to know you well and then ask after you, and then use some high return on investment to break through your defenses. . They will also use different role-playing methods to get up and down the line to find you for investment, or to recruit relatives and friends to join and get high commissions.
3: Pretend to be an exchange employee to defraud personal information and transfer money
You may encounter someone who claims to be an exchange staff member and says that your account is suspected of violating regulations for some reason (or suspects that your account is not operated by me... and other reasons). In order to prove that you are the person, you need to submit it within the time limit. A specified amount of coins is sent to an account. After receiving the coins, they will review it for you and help you unfreeze your account.
Is this similar to someone claiming to be a bank clerk? They will say that they want to "cancel the installment" or "account error", and then ask you to go to the ATM to operate. In fact, they are transferring their own money to the fraud group. Please remember that the staff of the exchange will not take the initiative to look for you, and those who look for you are basically scammers.
4: OTC fraud, OTC fraud
OTC (Over-the-counter) refers to over-the-counter trading. The method of fraud is to use the transaction process of virtual currency. Since it is decentralized, there is no so-called "official" or "third party" to supervise the transaction. Anyone can directly use the computer to After completing transactions with others, fraud groups take advantage of these loopholes. If investors want to take advantage of small gains and buy and sell privately on their own, they may conduct OTC transactions with the other party.
These scammers are the same as online shopping scams. They usually post virtual currency buying and selling information on social media, FB, Line, investment forums and other non-exchange places. You cannot verify the identity of the other party. The transaction process is private and there is no lack of information. Third-party supervision. The scammer pretends to buy or sell coins, but after you transfer the money or transfer the coins to him, the other party will neither pay nor give you the coins. If you can't find anyone, you can't pursue it. So remember that transactions must be completed under supervision.
5: Fake virtual currency promotion
We must understand that investing in virtual currencies inherently carries risks, not to mention that the market is rife with scams. So when you want to invest, be sure to do enough homework and don't be easily attracted by overly attractive promises. As the old saying goes: "There is no pie in the sky."
How to avoid virtual currency investment scams?
1. Use well-known manufacturers, including exchanges and wallets.
Because there are many virtual currency exchanges around the world, it is recommended to choose an exchange platform that is relatively large in scale (world-renowned), has been established for a long time (2-3 years), and has a large trading volume (easier to make deposits and withdrawals).
2. Do not trust any OTC offline transactions.
In addition to being careful when using exchanges and wallets, novices must not believe in promotions from FB and LINE groups, and do not use links given by netizens to open accounts and remittances. Don’t believe that customer service staff will proactively ask for personal information verification.
3. Newbies only invest in well-known virtual currencies.
Don’t invest in a cryptocurrency that someone else is trying to sell you that you’ve never heard of. It is really important to do your homework beforehand. If you have never heard of or don’t understand virtual currency, don’t touch it. 80% of investments in initial currency offerings like ICO (Initial Coin Offering) are scams around the world. So wait until you are an investment veteran who has learned to read ICO white papers before considering it. Because like most Ponzi scams, many use unknown junk virtual currencies as investment projects to defraud money.
4. Information from investment communities must be filtered.
Even the virtual currency investment community with tens of thousands of people still hides fraud groups. Projects that are discussed by many people are not necessarily safe. Because virtual currency basically does not require marketing, fraud groups often use a question-and-answer method to make you think that many people are making money on these platform projects. It turns out that they are all directing and acting on their own, and the entire community is a fake account, just to deceive. You were fooled.
5. Novices should do more homework before investing.
For any investment, you must understand the investment projects and characteristics, such as the type of virtual currency, the characteristics of buying and selling, the security of the account, and the ability to bear high risks. Once you understand it before entering the market, you will not lose all your money.
6. Seek help from others! Call 165 anti-fraud hotline for inquiry
What should you do if you have checked a lot but still have no clue? As long as you suspect fraud, you can call the 165 anti-fraud hotline of the Police Department of the Ministry of the Interior and tell them what kind of situation you have encountered so far. There will be experienced staff staff to answer your questions.
How to deal with virtual currency fraud after it occurs?
There are two ways to deal with being defrauded, depending on whether the money handed over has been withdrawn by the other party. If the other party has not yet withdrawn it:
Dial 165 for "Emergency Transfer"
When you transfer money to the designated account or notice something is wrong within a short period of time, you can immediately call the 165 anti-fraud hotline. They will perform an "emergency transfer" for you and lock your money in the account first. After that, report the crime to the police station immediately. This will ensure that the remitted funds will be frozen in the designated account and will not be withdrawn or transferred to other cash flow channels.
Legal compensation
If the investment amount has been withdrawn or transferred to other cash flow channels, you need to report the case to the police and seek compensation from the members of the fraud group through legal channels. However, if the police cannot trace the source, or the fraud group has spent all your money and has no property to compensate you, it will be difficult to recover the amount defrauded.
What information needs to be sorted out? Here are a few points for readers' reference:
Conversation Record
Deposit exchange website
Virtual currency related addresses (yours & the other party’s)
Cash flow records and transfer records (both Taiwan dollars and virtual currencies are required)
Can I get my money back from virtual currency fraud?
Bottom line: It’s difficult. Cryptocurrency scams are just like other financial scams, except the scammers are targeting your crypto assets instead of your cash. Because virtual currency (cryptocurrency) is a form of currency stored on blockchain technology and does not rely on financial institutions to operate, it is very difficult to recover from theft. Even for those of us in the industry, it's difficult to get it back, and cryptocurrencies can be quickly moved overseas with limited regulation.
If you call 165 to deposit investment funds at the moment of remittance or shortly after, and immediately call the police to freeze the funds in the designated account, the investor may still get back the investment funds. But it’s better to be cautious before investing!
