Crypto Romance Scams: A Growing Form of Online Fraud

What Is a Romance Scam?

An online romance scam is a cybercrime whereby criminals create a fake but often extremely detailed and convincing online identity that includes a name, location, photograph, profession, and so on. The scammer joins a dating site or social media platform as the imposter they’ve created, sometimes targeting the cryptocurrency of an unsuspecting person. These crypto scammers develop a relationship with their target person and pretend to fall in love, gaining the target’s confidence and then robbing them of their crypto. For some romance scam victims, this can amount to their entire life savings.

As you can likely imagine, this type of fraudster is not seeking a relationship at all. In most instances, the scammer wants money, and they may want it in cryptocurrency. Typically, these relationships remain online, and the romance ends when the abused person realizes that it’s all a scam and cuts off their perpetrator. As the actions undertaken by the victim are usually voluntary, there is far less recourse for justice than with most theft or crime. Unfortunately, romance scams account for 24% of all fraud committed on social media, and are a growing concern.

Dating and Romance Scam Victims: Social Engineering 

Dating and romance scams are types of social engineering attacks. Their techniques rely on psychological manipulation tactics that exploit human vulnerabilities rather than on the technical hacking prowess that might exploit structural weaknesses in a network or computer code.

Many romance scammers also tend to work in teams, with each team member fulfilling a different behind-the-scenes function. Team members could, for example, assist the original perpetrator by pretending to work at a fake crypto exchange help desk or customer service department, allegedly to help the victim reclaim their crypto. Other romance scammer tactics include posing as a friend or relative of the perpetrator who’s ill, needs money, and so on.

Fake romance scams can be lucrative for the scammer, so these scammers are generally patient and persistent. It’s not uncommon for romance scam victims to repeatedly send crypto over an extended period for various reasons. The scammer has likely spent time and energy researching their target on dating apps or other types of social media. They’re in it to steal as much money as possible from a victim, so they’ll often take their time and keep that relationship alive as long as the target is sending crypto.

COVID-19 Spurs Romance Scams Using Bitcoin and Crypto

While we were sheltering in place during the COVID-19 lockdown, cryptocurrency romance scammers were mining dating sites for victims. According to the Federal Trade Commission (FTC), people aged 20–49 were over five times more likely than older people to report losing money in romance scams using bitcoin (BTC) and cryptocurrency in general. Those in their 20s and 30s lost more money to investment scams than any other form of fraud, and more than half of those losses resulted from crypto and bitcoin romance scams. The FTC said it received nearly 7,000 crypto scam reports in the last quarter of 2020 and the first quarter of 2021, which is 12 times the number reported during the same period in 2020.

In September 2021, the Federal Bureau of Investigation (FBI) issued a public-service announcement that warned of a rising trend of criminals defrauding victims via online romance scams, in which they persuade individuals to send money allegedly to invest or trade cryptocurrency. From Jan. 1, 2021 through Jul. 31, 2021, the FBI Internet Crime Complaint Center (IC3) received over 1,800 complaints related to romance scams, resulting in losses of approximately $133,400,000 USD.

Romance Scam Red Flags

In addition to exercising hyper alertness when using an online dating site, there are some romance scam red flags to look out for:

• The scammer and victim never meet in person. A scammer might make excuses about why a face-to-face meeting can’t happen.

• A romance scammer generally won’t agree to a video call, but if they do, they might make the picture fuzzy, dark, or otherwise hard to see; they also could adjust the audio to be hard to hear or to be disrupted in some other way, complaining of poor technology.

• Finally, after getting their target to believe that they are dependable, a scammer might do something uncharacteristic like disappear from the dating site for a long time without responding to the victim’s messages.

If you do experience these or any other potential signs of a romance scammer, it might be wise to consider disassociating yourself from the related person.

How To Protect Yourself From Romance Scammer Tactics

Education and awareness are critical tools to counter different types of romance scams. However, many victims feel a sense of shame about not recognizing the signs of a romance scammer. Often, they feel embarrassed to admit to their family and friends that they “allowed” this to happen to them. Romance scam survivors might even feel too humiliated or afraid to expose their experience to authorities. If this is you, falling victim to a romance scam is not your fault in the least. The individuals who inflict crypto romance attacks are malicious criminals.

To counter romance scammer tactics and protect yourself from hacks and scams, it’s essential that your basic personal security precautions are in place. Here are some important do’s and don'ts:

Do:

• Use ultra-strong passwords for each account. 

• Keep antivirus and antimalware software updated.

• Use multi-factor authentication (MFA) or two-factor authentication (2FA).

• Treat with caution those who claim to have exclusive investment opportunities with “amazing profits,” or similar superlatives; especially if they say to “act fast,” or “act now.”

• Tell somebody about your experience, including governmental authorities.

Do Not:

• Download attachments from unknown sources, or even attachments from familiar email addresses that might seem suspicious.

• Use unfamiliar USB drives in your computer, or leave a device unattended in public.

• Use data such as your place of birth, pet’s name, favorite vacation spot, or mother’s maiden name in your passwords.

• Send money, trade, or invest based on the advice of someone you have met only online.

• Give your Social Security Number, copies of your passport, government-issued ID card, etc., to anyone you don’t know and trust.