The increased threat of cryptocurrency scams, especially in this time when people seem to be susceptible to them, has reached some authorities as well. Most are alerting people to be additionally careful at this time.
Gavin Newsom, the Governor of California, has pointed that list. In a cut of his speech posted on Twitter, the Governor is seen mentioning some of the plans that his administration has taken to combat the spread of the coronavirus. He also name-dropped Bitcoin.
Governor Gavin Newsom just mentioned bitcoin during his COVID-19 announcement. pic.twitter.com/Z6TsnfT6XY
— Vis (@Vis_in_numeris) March 25, 2020
Shining Some Light on Bitcoin Scams
While the acknowledgment of Bitcoin is great, Newsom wasn’t mentioning the top digital asset in any good sentiment. He explained that several people have been deceiving people and impersonating government officials, thus collecting Bitcoin from people under false pretenses.
He cautioned people to be especially careful about these fraudsters, adding that they should stay safe and protect themselves in this period.
Newsom isn’t the only authority figure to be pointing out an increase in Bitcoin-related coronavirus scams. Last week, the Commodity Futures Trading Commission (CFTC) published a press release in which it confirmed that it had received hundreds of fraud complaints that involve forex or cryptocurrency-related investment schemes that deliver significant returns in unbelievably short time amid the increasing coronavirus concerns.
“After depositing a few hundred dollars of cryptocurrency, the traders are fed a number of fake statements showing huge returns. When the traders try to cash out, they’re told they must first pay a fee to get their earnings. They pay the fee, then are told they need to pay a tax, then more fees, and so forth. Never send more money to get what is yours.”
The agency warned that people should be careful at this time and should desist from making any investment decisions based on panic and hysteria. Also, all investment schemes should be properly vetted to ensure that they have the right certifications.
A Perfect Time to Be a Scammer
Most of the scam reports so far have been impersonating scams. Last week, IT security firm Sophos confirmed that it discovered a new wave of fraudulent operations where attackers impersonate health agencies and ask their victims to send Bitcoins to them.
Chester Wisniewski, a principal research scientist at the firm, explained that they’ve been monitoring hacking activities across the world since the virus became a global pandemic, and he added that they’d seen an alarming growth in the number of phishing scams.
The report explained that these scams started with phishing Emails promoting COVID-19-related materials and installing malware in computers. However, scammers have now evolved and are impersonating the World Health Organization (WHO) and other charities and agencies. Some have copied the COVID-19 Solidarity Response Fund, and are now sending Emails that are identical to those of the fund itself.
The case increasing of coronavirus scams isn’t entirely surprising. Lots of people are ignorant about the virus and will take any information they can get in a heartbeat. When a scammer alerts them and claims to be from some authority or the other, they will be much more susceptible to heeding their advice and giving them money.