Americans lost $5.6 billion last year in cryptocurrency fraud scams, the FBI says

The FBI says Americans were duped out of more than $5.6 billion last year through fraud schemes involving cryptocurrency

Cryptocurrency Fraud FBI (Copyright 2023 The Associated Press. All rights reserved.)

Americans were duped out of more than $5.6 billion last year through fraud schemes involving cryptocurrency, the FBI said in a report released Monday that shows a 45% jump in losses from 2022.

The FBI received nearly 70,000 complaints in 2023 by victims of financial fraud involving bitcoin, ether and other cryptocurrencies, according to the FBI. The most rampant scheme was investment fraud, which accounted for $3.96 billion of the losses.

“The decentralized nature of cryptocurrency, the speed of irreversible transactions, and the ability to transfer value around the world make cryptocurrency an attractive vehicle for criminals, while creating challenges to recover stolen funds,” wrote Michael Nordwall, assistant director of the FBI's criminal investigative division.

Scammers will often make contact through dating apps or social media to build trust over several weeks or months before suggesting cryptocurrency investing, the FBI said. Once the relationship is built, they convince the targets to use fake websites or apps to invest their money, sometimes even allowing the victims to withdraw small amounts of money early on to make it seem legitimate.

In some cases, those victims are then targeted by bogus businesses claiming they will help the victim recover the cryptocurrency they lost, according to the FBI.

FBI officials say Americans of all ages can be a target of such scams, and should be extremely cautious when presented with investment opportunities from people they've never met in real life.