British Columbians are being targeted for millions of dollars using crypto-currency and non-fungible token (NFT) scams, officials say.
According to the B.C. Securities Commission, BC RCMP and the Canadian Anti-Fraud Centre, Canadians lost a whopping $530 million in 2022 to fraud and cybercrime, with $24 million in crypto-scam losses taking place in B.C.
An NFT is a digital asset for a unique item that can neither be replaced nor interchanged because of a unique digital footprint, which is supposed to be monitored.
The real numbers are expected to be much higher as officials said only five to ten per cent of victims report these types of fraud.
“If promises of high returns on investment seem too good to be true, you’re probably right,” said Kurt Bedford, BC RCMP Federal Serious and Organized Crime’s officer in charge said.
“Although our dedicated investigators at the BC RCMP financial integrity unit work hard to solve some of the most complex financial crime-related offences, investor education and prevention still remain the first line of defence against becoming victims of investment fraud.”
According to a release by the RCMP, scammers are using the popularity and complexity of crypto assets to target vulnerable investors — primarily through social media.
The B.C. Securities Commission has created an interactive website to help educate people about the dangers of crypto scams and how to spot them, as part of Fraud Prevention Month.
“Investing in crypto is risky, and one of the biggest risks is outright fraud. You could lose all your money,” Doug Muir said, B.C. Securities Commission’s director of enforcement.
Some characteristics of crypto scams include:
- Promises of guaranteed high returns on an investment
- Complicated jargon and language that is difficult to understand
- Unregistered salesperson — many investment frauds involve individuals or firms not registered to buy or sell investments. Always check AreTheyRegistered.ca before investing
- Unsolicited offers — be extremely cautious if you receive unsolicited communication over email, by phone, pop-up ads and videos on the internet, or direct messages on social media
- Pressure to buy — scammers may try to create a false sense of urgency to take advantage of an investment before it’s too late
Another piece of advice for potential crypto investors — make sure the trading platform being used is registered with Canadian securities regulators.
Three weeks ago in Winnipeg, police issued a warning after a person was scammed out of $168,000 worth of bitcoin.
Winnipeg police say they began investigating in October 2022, after they were told the victim had purchased bitcoin over three months and was told to invest it, ostensibly to make more money.
That “investment,” however, was a scam in which the victim’s funds were transferred overseas and changed to another form of cryptocurrency.
Anyone who suspects they have been a victim of cybercrime or investment fraud should report it to their local police, the CAFC (either through its online reporting system or by phone at 1-888-495-8501) or to the BCSC.
— with files from Global News’ Sam Thompson