ABC News Today

November 11, 2022

SINGAPORE – The number of cryptocurrency scams reported globally has tripled every year, with victims lured by the prospect of getting rich quick.

At the global anti-scam summit on Wednesday and Thursday, experts said they expect the trend to continue as the global economic outlook remains volatile.

The event is organized by the Global Anti Scam Alliance and is held at The Hague Security Delta in the Netherlands, bringing together researchers, cyber security experts and anti-scam agencies from around the world.

On Wednesday, Mr Camill Cebulla, the director of Singapore-based cyber security firm Group-IB, said he found that crypto scams had increased by 335 percent in the first half of the year compared to the same period of 2021.

In the first six months of 2022, the company had identified more than 2,000 domains registered to promote crypto scams alone.

These scams use videos containing deep spoofs of popular personalities like tech mogul Elon Musk, luring victims into a purported gift of cryptocurrency in exchange for their crypto wallet details and personal information.

Group-IB found that there were about 20,000 viewers for each fake crypto giveaway stream.

In one case, Mr. Cebulla said the team had monitored several crypto wallets controlled by fraudsters.

They found that in just three days, from February 16 to 18, the fraudsters stole more than US$1.68 million (US$2.4 million) through 281 transactions.

In Singapore, the number of crypto scams reported to the police has increased fivefold since 2019, with 631 reports made in 2021.

In a written response to a parliamentary question by Mr. Melvin Yong (Radin Mas) In October, Law and Home Affairs Minister K. Shanmugam revealed that there were 125 such reports in 2019 and 397 in 2020.

The minister said most of those behind these scams are based outside Singapore, which limits how much law enforcement can do here.

“Our ability to solve these cases will depend on the level of cooperation of foreign law enforcement agencies, as well as their ability to track down these fraudsters,” he said.

“When money has been transferred overseas, recovery is even more difficult.”

At Thursday’s summit, Mr. Nick Smart, director of blockchain intelligence firm Crystal Blockchain, said the number of crypto scams has continued to rise year-on-year over the past six years.

He said these scams occur because victims are attracted by the prospect of big profits and fraudsters want to trade in crypto, as it’s easier to transfer stolen funds that way and harder for victims to recover.

“Crypto is very attractive to people who are struggling and looking for a way out,” he said.

“It’s very difficult to recover (crypto is lost to fraudsters) because of the nature of the blockchain. But that hasn’t stopped people from trying to get their money back.”

Smart warned that when law enforcement officials tell them the chances of recovery are next to nil, some victims turn to private entities that claim they can get their money back.

He said many entities that claim to be able to do “crypto recovery” are often misleading, telling potential customers they can do in hours what would take a supercomputer decades.

Smart said victims who are already desperate and desperate would hand over a fee before being told they wouldn’t get their money back.

At the end of his presentation, Jorij Abraham, CEO of the Global Anti Scam Alliance, stood up and called these entities “ruthless”.

He said: “They are ruthless… They know they can’t get the money back.”