Delta police are warning residents to be extra careful and do their homework before investing in cryptocurrency following a number of recent fraud complaints.
“The news stories are enticing: Bitcoin valuation reaches new highs. Eretheum, Dogecoin up 10 per cent,” reads a DPD press release issued Friday afternoon (Sept. 3).
“There is a lot of interest in investing in cryptocurrency, but at the same time scammers are capitalizing on that fact, and many are taking advantage of investors’ lack of knowledge on how to invest in this market.”
Police say they have received six complaints about residents being scammed with they tried to invest in crypto currencies in recent months — most of those in August — and the victims’ losses have been significant, from just under $5,000 to over $100,000.
Const. Dustin Classen of the DPD’s cybercrimes section said that in all of those cases, there is no chance for the investors to recoup their losses.
Police say several of the incidents have factors in common. In most cases, the scammers contacted the would-be investors through an online platform, varying from dating sites to chat apps, and established an online “relationship.” was established. In two cases, the investors clicked on an ad that led them to an illegitimate company.
The investors were typically encouraged to e-transfer funds from their bank accounts to mobile wallets, and from there to unknown accounts. In some cases the scammers walked the victims through the process online, even having the victim download software to allow the scammer access to their computer.
Then, when victims tried to withdraw their “profits” or their investment, either the money was gone or the victim was informed they needed to pay considerable additional fees to access their money.
“If you are going to invest in cryptocurrency, be very cautious,” Classen said in a press release.
“I would advise investors to check the URL or domain of the investment website and do their homework,” Classen said. “Is the investment firm well established and reputable?”
Police recommend residents visit the British Columbia Securities Commission’s website (investright.org) for advice and tips for potential investors, including a video which explains the scams in greater detail.
Investors can also check specific investment companies to determine if they are subject to investigation by the B.C. Securities Commission at bcsc.bc.ca/enforcement/early-intervention/investor-alert, and Canadian Securities Administrators runs a website — aretheyregistered.ca — where people can check the registration of securities industry professionals.
Other tips on investing in cryptocurrency:
• Cryptocurrency transactions are not reversible. Once the funds are sent, they cannot be recalled.
• Before transferring any money, research the name of the investment company online and see if anyone else has been scammed.
• Do not rely on investment advice from someone online who you’ve never met. There’s a very strong chance they are a scammer.