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Common Crypto Scams and How to Protect Yourself

September 26, 2022

Cryptocurrency is an innovative and convenient way to invest that has caught the eye of many—unfortunately, that includes scammers. As with any new technology, there are always those who seek to take advantage of new adopters.

If you’re thinking about getting involved in the crypto world, be cautious. Crypto transactions are like cash transactions in that if you fall victim to a scam, you’re unlikely to be able to recover your funds.

Here’s some advice to help you understand, spot, and avoid these rising scams.

Identifying cryptocurrency investment scams
Scammers use a variety of tactics to convince you to act fast and invest with promises of “guaranteed” high returns from your investments. Stay alert to these warning signs that you’re dealing with a scammer:

  • You’re asked to keep the transaction a secret or to lie to your financial institution. No legitimate business will ever ask you to do this.
  • You’re unexpectedly contacted about investing in cryptocurrency.
  • You’re pressured to act quickly and your questions aren’t being answered.
  • You’re asked to provide your personal financial information or login information.
  • You’re told to remove any funds from an account for the purpose of “securing them.”
  • You’re asked to provide access to a personal device.

How you can avoid falling victim
Many cryptocurrency scams are sophisticated and convincing. Here are some ways to keep your funds safe from crypto scammers:

  • Avoid links promising easy money.
  • Ignore cryptocurrency-related social media ads.
  • Meet with your financial advisor in person.
  • Question any investment “opportunity” that requires you to pay up-front fees and/or taxes to cash out on your investment.
  • Be alert to anything suspicious—for example, legitimate advisors will not initiate contact through social media messages.
  • Ask friends and family for recommendations.

The best way to protect yourself from cryptocurrency fraud—or any potential scam attempt—is to exercise caution and conduct thorough research. If it sounds too good to be true, it probably is.

If you suspect you’ve fallen victim to fraud, please call us at 1 (800) 479-7928 or contact us online. Learn how to protect your accounts from additional fraud and scams by visiting our online security center.