It’s not every day police need to issue financial advice, but today they have.
A Sunshine Coast man who spent the last 10 months caught up in a cryptocurrency scam is now $100k worse off, with the investor’s crushing blow prompting Queensland Police to urge caution when delving into the world of cryptocurrency.
According to police, the 54-year-old Sunshine Coast resident invested $50,000 into a cryptocurrency scheme which offered profit to investors through a legitimate trading platform – but the account had been set up by scammers.
“The scheme was devised to make the victim believe the trades and profits were genuine, when in fact the data was misleading,” a statement from Queensland Police said.
“As part of the scam the man was informed he would not be able to draw on the false profits for a 12-month period.”
Six months after he was tricked into believing the scheme was genuine, the victim was convinced to invest another $50,000 into the scam which offered to “increase his level of investor membership to Platinum”.
Police said the original account was set up by the scammers through a legitimate online platform which meant the scammers also had withdrawal access under the provisions of the account.
Senior Sergeant Craig Mansfield, from Sunshine Coast Criminal Investigation Branch, said it wasn’t the first time he’d seen this type of fraud.
“Victims need to be aware of jurisdiction issues and the anonymity of crypto account holders,” Sergeant Mansfield said.
“In this instance, the victim did not set the online trading coin wallet up, so it’s believed the withdrawals were undertaken by anonymous entities shortly after the deposits were made,” he said.
And policing the crypto world is difficult.
Sergeant Mansfield said victims are often diverted from email for contact to an app-based encrypted communication platform that cannot be intercepted by authorities.
“Whilst police can investigate, given that most scammers are offshore, it is unlikely we can recover funds or even commence proceedings locally, however we will work with other jurisdictions nationally and internationally to further these investigations where possible,” he said.
“Potential investors are warned to be wary of the promise of significant returns or guaranteed returns, especially those with time limitations on when they can withdraw, which gives fraudsters a longer period to operate,” Queensland Police recommended.
Red Flags to look out for:
- If you are told you won’t have access to your funds for a set period
- Others offering to set up your Crypto Wallet for you
- Being lured into investment levels with terms such as Silver, Platinum or Gold level customers as an example.
- If it’s too good to be true, it usually is not true.