In a move to safeguard cryptocurrency investors, U.S. authorities have sounded the alarm on a troubling trend: scammers posing as government officials. With corroborative data from the Federal Trade Commission (FTC), the Cybersecurity and Infrastructure Security Agency (CISA) issued a stark warning in a revised advisory on Wednesday, emphasizing the sophisticated nature of these scams and their potential to wreak havoc on unsuspecting victims.
FTC data shows major increases in cash payments to government impersonation scammers: https://t.co/PL7SMga3gS #WEAAD #FedsFightFraud /1
— FTC (@FTC) June 14, 2024
Scammers are pretending to be government employees. They may threaten you and demand immediate payment. Don’t be fooled! #SlamTheScam and HANG UP! Report the scam at: https://t.co/BwciVeKD5y #FightThePhish pic.twitter.com/xS8P07oU45
— Cybersecurity and Infrastructure Security Agency (@CISAgov) March 7, 2024
The Growing Threat of Impersonation Scams
Cryptocurrency scams are nothing new, but the brazenness and ingenuity of these latest impersonations have escalated the threat. Scammers are leveraging the guise of government authority to dupe investors, a tactic that has proven alarmingly effective.
According to the FTC data, consumers reported losing a staggering $76 million to government impersonation scams in 2023, a 90% uptick from $40 million in 2022.
Recognize business and government imposters who want your money: https://t.co/JwMp6rcJGN #FedsFightFraud #WEAAD2024 /5
— FTC (@FTC) June 14, 2024
The modus operandi typically involves phony emails or phone calls from individuals pretending to be from federal agencies such as the IRS, SEC, or even the FBI. These impersonators aim to extract sensitive information or trick victims into sending cryptocurrency to fraudulent addresses.
Why do scammers pose as the CISA, and what is it?By Greg CollierScammers are never above impersonating any branch of the government. Most commonly, they pose as the IRS, the Social Security Administration, or the FBI. Now, it appears scammers are posing as an obscure office… pic.twitter.com/XJc7nZc4va
— Greg Collier (@gregcollier) June 14, 2024
A notable instance involved a phishing campaign where emails mimicked official correspondence from agencies like the SEC. The emails contained links to fake websites that closely resembled legitimate government portals. Victims were then coaxed into providing personal information or making payments under the pretense of resolving tax issues or regulatory breaches.
CISA has highlighted the sophistication of these scams, noting that they often use advanced social engineering tactics. According to a report, these scams are not only elaborate but also highly personalized, making them particularly hard to detect. For instance, during an attack on June 5, 2024, phishing emails were sent to subscribers of a prominent crypto firm via a compromised mailing list provider, resulting in unlawful access and export of private details of approximately 1.9 million users in just a few hours from their database.
The SEC has also been proactive in addressing these scams. In a recent investor alert, the agency underscored the “devastating losses” suffered by retail investors due to these fraudulent schemes and pointed out that the popularity of initial coin offerings (ICOs) and other digital assets has made the crypto space a hotbed for scam activities. As highlighted by Cointelegraph, the fear of missing out (FOMO) is a significant driver behind many investors falling prey to these scams.
Moreover, impersonation scams extend beyond emails. Social media platforms are rife with fake profiles of well-known crypto personalities and companies. For instance, the SEC’s @SECGov X account was compromised on Tuesday, January 9, 2024, and an “unauthorized” post was tweeted from it.
Who Are the Targets?
Scammers predominantly target older adults. In 2023, nearly half of the complainants were over 60 years old, accounting for 58% of the losses (almost $770 million) nationwide. Tragically, some victims faced such shame or financial strain that they resorted to suicide.
Beware of phishing scams! Don't take the bait —look out for suspicious emails and links. Verify before you click. Check out our resources on phishing: Phishing Guidance: Stopping the Attack Cycle at Phase One https://t.co/kAS4cNFF3R#InternetSafetyMonth pic.twitter.com/ViNWdyh5wo
— Cybersecurity and Infrastructure Security Agency (@CISAgov) June 7, 2024
To stay safe, investors should adopt a skeptical approach to unsolicited communications, verify the authenticity of any contact through official channels, use strong passwords, and avoid clicking on links or downloading attachments from unknown sources. As the old saying goes, “If it sounds too good to be true, it probably is.”
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