Beware cryptocurrency trading scams

The Australian Competition and Consumer Commission (ACCC) has revealed investment scammers stole more than $70 million from Australians in the first half of this year.

Data from ACCC’s Scamwatch showed a 53% increase in reports about investment scams, with more than 4700 reports received so far in 2021.

ACCC Deputy Chair Delia Rickard said cryptocurrency trading scams accounted for more than half of the money stolen.

“Investment scams are more prevalent than ever, and scammers are capitalising on interest in cryptocurrency in particular,” Ms Rickard said.

“More than half of the $70 million in losses were to cryptocurrency, especially through Bitcoin, and cryptocurrency scams were also the most commonly reported type of investment scam, with 2,240 reports.”

People are being urged to discuss the topic of scams with family and friends during Scam Awareness Week from 8-12 November.

Cryptocurrency scammers pretend to have highly profitable trading systems and may use fake celebrity endorsements to try to enhance their legitimacy.

Victims will initially be able to access small returns sourced from other victims’ initial deposits but the scammers soon claim problems with making withdrawals and cut off contact.

“Be wary of investment opportunities with low risk and high returns,” Ms Rickard said.

“If something sounds too good to be true, it probably is.”

Losses to investment scams involving Bitcoin have increased by 44%, reaching $25.7 million this year, compared to $17.8 million across 2020.

If you're thinking about investing in cryptocurrency, listen to the Australian Securities and Investments Commission’s podcast on what to think about and look out for before you invest.

People who think they’ve been scammed should contact their bank or financial institution as soon as possible. You can also contact IDCARE on 1800 595 160 if you suspect you are a victim of identity theft. IDCARE is a free, government-funded service that will support individuals through the process.

The information in this article has been prepared for general information purposes only and is not intended as legal advice or specific advice to any particular person. Any advice contained in the document is general advice, not intended as legal advice or professional advice and does not take into account any person’s particular circumstances. Before acting on anything based on this advice you should consider its appropriateness to you, having regard to your objectives and needs.