Ontario Provincial Police have issued a warning to residents about fraud after an Essex County resident lost thousands of dollars in a cryptocurrency scam.
The Essex County OPP received a complaint from a Leamington resident who said they lost over $25,000 in a crypto investment scheme.
"The majority of the investment scam reports involve Ontario residents deciding to invest in cryptocurrency after seeing a deceptive advertisement on social media," read a release from the Essex County OPP. "It typically involves victims downloading a trading platform and transferring cryptocurrency into their trading account. In most cases, victims are not able to withdraw their funds. It is very likely that many of the trading platforms are fraudulent or controlled by fraudsters."
According to the Canadian Anti-Fraud Centre (CFAC), $163-million in investment losses were reported in 2021, compared to only $33-million in 2020. Payments to scam artists for cryptocurrency schemes alone accounted for $77-million in 2021, in contrast to $23-million from the year before.
The OPP has taken reports from residents bamboozled by initial coin offerings (ICOs), Ponzi schemes, futures trading, franchise offerings, marketing opportunities. and "pump and dump" schemes, which involve the price of cryptocurrency or stock being inflated intentionally through false or misleading information.
Here are some warning signs to watch for if you are approached about cryptocurrency investment.
- Returns that may appear to be higher than a typical investment
- Unsolicited social media, email, or telephone investment offers
- An overly-aggressive pitch
- Someone you met on a dating or social media site who immediately wants you to invest in cryptocurrency
- A friend providing an opportunity through email or social media
- "Too-good-to-be-true" advertisements
- A request to transfer a legitimate crypto investment to a separate email address
If you think you've become a victim of a cryptocurrency scam, contact your local law enforcement agency immediately, and provide as much information as you can. You can also report it to the CAFC through their webpage on the Government of Canada's website.