A high street lender has issued a warning to social media users about the rise in cryptocurrency fraud cases, particularly those involving celebrity endorsements. Santander reported a significant increase in such scams, with a 61% rise in cases between Q4 2021 and Q1 2022. The average cost of these scams also increased by 65% year-on-year in the first quarter, reaching £11,872.
The lender projected an 87% surge in these cases by the end of 2022 compared to 2021 figures. Users are often lured into investing in fraudulent schemes through fake celebrity endorsements online. These scams can manifest as ads on social media, legitimate websites, or online search listings.
Once users click on these ads and provide their personal information, they may be contacted through phone, email, or social media messages and promised high returns with minimal risk. Scammers use aggressive sales tactics to pressure victims into depositing money. After the funds are deposited, scammers freeze the account and steal the money. They often gain access by tricking victims into downloading remote access Trojan (RAT) software, allowing them to take control of the user’s computer.
Santander’s head of fraud risk management, Chris Ainsley, emphasized the importance of conducting thorough research before investing in any opportunity, regardless of who endorses it. He highlighted the need for vigilance and caution to prevent falling victim to these sophisticated criminals.
Daniel Holmes, a fraud expert at Feedzai, emphasized the need for collaboration among industry stakeholders to combat the rise in cryptocurrency scams. He stressed the importance of user awareness, banks’ ability to detect and prevent fraud quickly, and crypto platforms’ responsibility to protect themselves from being used as conduits for illegal activities.
In conclusion, addressing the growing threat of cryptocurrency fraud requires a united effort from all parties involved. By staying informed, exercising caution, and working together, we can help safeguard the integrity of the cryptocurrency market and protect users from falling prey to fraudulent schemes.