STUARTS DRAFT — Investing in cryptocurrency can be a tough strategy as the market remains highly volatile.
But it’s an even tougher endeavor when one sends tens of thousands of dollars to an online scammer purporting to be in the cryptocurrency business. A 63-year-old Stuarts Draft man recently found that out the hard way after wiring about $46,000 to a person claiming to represent a cryptocurrency company.
The Augusta County Sheriff’s Office said the Draft man met a person on social media in June who claimed to represent a crypto company called “Wealth Front Exchange.” Beginning in early June, the victim started wiring multiple payments to the scammer, the sheriff’s office reported. The payments continued into July.
The victim reported the theft Friday.
The sheriff’s office said while there is a business in the crypto sector called Wealthfront, it could not find a company under the name of “Wealth Front Exchange.” The agency said the scam originated from an undisclosed foreign country, and said it’s unlikely the stolen money will be recovered.
The sheriff’s office said the investigation is ongoing.
According to the Federal Trade Commission, cryptocurrency scams have become “alarmingly common.”
Since the beginning of 2021, nearly 50,000 people have lost over $1 billion in crypto scams, almost 60 times more than in 2018. Many of the scams started online. In a June report the FTC said, “Nearly half the people who reported losing crypto to a scam since 2021 said it started with an ad, post, or message on a social media platform.”
Of the reported crypto fraud losses that begin on social media, the FTC said most are investment scams.
“The stories people share about these scams describe a perfect storm: false promises of easy money paired with people’s limited crypto understanding and experience,” the FTC said in the report. The supposed crypto investments then go right into the scammer’s wallet, the report said.
In a fairly sophisticated twist, the FTC said it has received reports that supposed investment websites provide fake apps that make the victims believe they are tracking their crypto investments, even allowing for a small “test’ withdrawal. But when the investors actually try to cash out, they’re told to send more crypto for bogus fees and never get their money returned.
According to Ameritrade, Cryptocurrency is a virtual currency “secured through one-way cryptography.” Unlike traditional currencies, cryptocurrency is not controlled by any central government or authority.
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Brad Zinn is the cops, courts and breaking news reporter at The News Leader. Have a news tip? Or something that needs investigating? You can email reporter Brad Zinn (he/him) at bzinn@newsleader.com. You can also follow him on Twitter.
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