A Public Service

SCAMS BULLETIN Host Jay White is an inactive attorney in San Mateo County, California.

January 27, 2022

CRYPTOCURRENCY SCAM

Courtesy Federal Trade Commission

Cryptocurrency is a digital currency in which transactions are verified and records maintained by a decentralized system using cryptography, rather than by a centralized authority.

“Decentralized cryptocurrencies such as bitcoin now provide an outlet for personal wealth that is beyond restriction and confiscation”

There’s a new spin. Scammers asking people to pay with cryptocurrency. It involves an impersonator, a QR code, and a trip to a store (directed by a scammer on the phone) to send your money to them through a cryptocurrency ATM machine.

Here is how It works: Someone calls pretending to be from the government, law enforcement, or a local utility company. Maybe a romantic interest you met online calls to say you’ve won the lottery or a prize. They wind up asking you for money. If you believe the story they tell and you seem willing to engage, they will stay on the phone to direct you to withdraw money from your bank, investment, or retirement accounts. Then they will tell you to go to a store with a cryptocurrency ATM machine (they will stay on the phone the whole time). Once you are there, they’ll direct you to insert your money into the ATM machine and buy cryptocurrency. Here’s where the QR code comes in: They send you a QR code with their address embedded in it. Once you buy the cryptocurrency, they have you scan the code so the money gets transferred to them.  If you do it your money is gone.

Here’s the main thing to know. Nobody from the government, law enforcement, utility company, or prize promoter will ever tell you to pay them with cryptocurrency. If someone does, it’s a scam. Any unexpected tweet, text, email, call, or social media message — particularly from someone you don’t know — asking you to pay them in advance for something with cryptocurrency—it is a scam.

If you spot something like this, tell the FTC right away at ReportFraud.ftc.gov. To learn more about avoiding cryptocurrency scams, visit ftc.gov/cryptocurrency.

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