Cryptocurrency Scams Spread Further into America Heartland
[TL; DR]
Cryptocurrency scammers are targeting elderly citizens in the United States.
The scammers enter into romantic digital relationships with the vulnerable elders.
The attackers promise the victims high and quick returns on invested cryptocurrencies.
Introduction
There is a new wave of crypto scams targeting vulnerable elderly in the United States. Although investment scams focused on swindling funds from unsuspecting senior citizens are not new, they increased during the Covid-19 era when most of the elderly were lonely and depressed.
The scams aimed at swindling the elderly’s financial resources existed before 1963 when AARP’s founder, Dr. Ethel Percy Andrus, raised the issue before the U.S. Senate Special Committee on Aging. Today, we discuss how cryptocurrency scammers are targeting the vulnerable elderly in the United States.
Lonely Elderly Susceptible to Pig Butchery Crypto Scam
Many American elders are becoming victims of a type of crypto scam called pig butchery due to chronic loneliness. Over the past few years they lost their funds and the trend is getting worse. As a result of increasing cases of such scams the American Association of Retired Persons (AARP) has warned the elderly citizens, above 50 years, to watch out for such criminals.
Related article: What is a Honeypot in Crypto?
The seniors become victims when the scammers lure them by pretending to be youths who want to have romantic relationships with them. However, they only realize that they have been scammed after losing their hard-earned savings. Currently, most of these scammers persuade their unsuspecting victims to invest in cryptocurrencies.
Read also: Risks You Must Be Aware Of When Trading Crypto
During 2022, close to 70,000 individuals, who lost over $1.3 billion, reported romance scams to the United States Federal Trade Commission (FTC). Considering that there were 56,000 such scams and a total loss of $547,000 in 2021 it shows that the trend is getting worse.
In 2021, senior citizens, 70 years and above, lost an average of $9,000. However, across all ages there was an average loss of $2,400. According to the FTC 53,000 people lost more than $1.4 billion in cryptocurrencies during 2022.
As a result of the increase in romantic scams, the AARP Fraud Watch Network, AARP issues a warning to elderly citizens to desist from entering digital romantic relationships with people they do not know. Also, they should not put their funds in digital asset investments with people and institutions they do not have full understanding of.
Important to know: How Not to Fall For NFT Scams
How Pig Butchery Scams Work?
The scammers are generally tactful and take their time to get accustomed to the victims and lure them into fake crypto investments. They start off by pretending to be young, romantic, chatty and charming individuals with much interest in the welfare of their targeted elderly individuals.
They would lure the victims to invest in fake crypto investments once they establish close friendships. Often, the victims realize that they have been duped of their funds when it is gone.
Read also: Avoiding Crypto Scams: 5 Red Flags to Watch Out For
Mechanics of Pig Butchery Scams
The pig butchery scammers often follow several steps to ensure that they get the funds.
Initiating Contact: The scammers scout the victims online and start conversations using social media and messaging applications. Notably, they masquerade as young, attractive and friendly people. They also attach beautiful fraudulent images.
Kindling Romance: The attackers intensify their chats, sending several messages. Their aim is to foster closer relationships with their targeted victims. As such, they usually chat with the victims for hours on a daily basis to create emotional attachment. This stage, they call fattening the pig, may last for weeks or months.
Showing False Profits: The scammers introduce the victims to websites where they show them how to invest profitably. They use various proofs to show the increase in their investments. Also, they collect the funds through directing the victims to crypto AMTs and some malicious websites. Often, they use cryptocurrencies which promise quick and large returns.
Demanding more Funds: Lastly, the attackers demand more funds from the victims to purportedly cover for taxes and related fees. As such, the victims are further lured to give them more cash.
Read also: How to Protect Yourself From Seed Phrase Scams
Loneliness Among American Elders
The elders easily fall victim to these scamming tricks since they are lonely. A recent poll which the University of Michigan conducted, entitled National Poll on Healthy Aging, carried in 2023 shows a growing epidemic of loneliness among senior citizens in the United States.
As an example, the survey concludes that 34% of adults between the ages of 50 and 80 indicated that they felt lonely and isolated during the previous year. 29% of the participants showed that they felt isolated and lonely for “some of the time.” Yet, 5% of the respondents said that they felt isolated most of the time. According to them, the situation is now better than during the Covid-19 period.
In addition, about 37% of the elders said that they lacked companionship during 2022. On the other hand, 29% said that they lack companionship “some of the time” while 5% said that they often lack companionship. Nevertheless, they said that the situation was worse off during 2020.
In consideration of these statistics and the reality in America, a United States Surgeon General Dr. Vivek Murthy referred to the loneliness pandemic as a “public health crisis.”
Dr Murthy explained that the effects of loneliness and lack of companionship is far reaching and devastating. He said, “Our epidemic of loneliness and isolation has been an underappreciated public health crisis that has harmed individual and societal health. Our relationships are a source of healing and well-being hiding in plain sight – one that can help us live healthier, more fulfilled, and more productive lives.”
Read also: What Are The Most Common Types of NFT Scams?
Conclusion
The loneliness and lack of companionship pandemic in the United States has made the elders in the country susceptible to crypto scams perpetrated by individuals who pretend to be friendly to them. These scammers often lure their elderly victims to invest in cryptocurrencies that promise high and quick returns.
Read also: Crypto Pump and Dump Scams are Never Worth it, Here is Why
FAQs about Crypto Scams
What is crypto scam?
A crypto scam occurs when a criminal steals cryptocurrency from people. This may include hacking their digital wallets or deceptively getting their private keys or other important data. Once they get the vital data like seed phrases they steal their cryptocurrencies.
Which are the most common crypto scams in history?
The commonest crypto scams are rugpulls, phishing, fake investment schemes, fake applications, giveaway scams and fake crypto exchanges. Specific examples of the worst crypto scams include BitConnect Crypto Scam, OneCoin Crypto Scam, Bitclub Network Crypto Fraud, Pincoin Scam and Thodex Scam.
What percentage of crypto coins are scams?
Scams are the means through which illicit entities and individuals receive cryptocurrencies. According to Chainanalysis less than 0.2% of crypto transfers are through scams.
Have crypto scams increased?
Crypto scams increased significantly since the start of the Covid-19 pandemic and throughout 2022. According to the Federal Trade Commission (FTC) crypto scams increased by around 900% during this period resulting in more than 46,000 losing their crypto assets. However, Chainanalysis reports that there has been a drop in the number of crypto scams in 2023.
