The Federal Bureau of Investigation (FBI) in Miami has warned that crypto ATMs are emerging as a popular method that fraudsters use to receive funds from defrauded victims.
The information was revealed as part of an October 3 public warning about “pig butchering scams” where scammers pose as long-lost friends or potential romantic partners to extract money from victims.
Scammers “grease” their victims by showing a supposedly genuine interest in them to gain their trust, then gradually introduce discussions of investments into the relationship.
In the public service announcement in partnership with the Internet Crime Complaint Center (IC3), the FBI warned that victims of these crypto-pig-butchering scams generally have no chance of getting their funds back.
However, the FBI noted that they have noticed that scammers have increasingly directed their victims to transfer funds using crypto ATMs, along with more familiar methods such as wire transfers and prepaid cards, noting:
“Many victims report being directed to make bank transfers to overseas accounts or purchase large amounts of prepaid cards. The use of cryptocurrency and cryptocurrency ATMs is also an emerging payment method. Individual losses related to these schemes ranged from tens of thousands to millions of dollars.”
The FBI noted that in “pig butchering” scams, victims are “trained through an investment process” and “scammers encourage them to make continuous deposits.”
“When victims try to cash out their investments, they are told they have to pay additional income taxes or fees, causing them to lose additional funds.”
Crypto ATMs have long been used by fraudsters who pose as public officials, law enforcement officers, or employees of local utility companies and coerce victims into sending them payments under the guise of paying bills or unpaid taxes to avoid further penalties.
There are nearly 33,500 cryptocurrency ATMs in the United States according to data from Coin ATM Radar, and the US accounts for 87.4% of global crypto ATM distribution.
The US Federal Trade Commission issued a warning about crypto ATM scams in January, noting that scammers sometimes pose as potential romantic partners.
The FBI urged people to “verify the validity of any investment opportunity” introduced by such people, to be on the lookout for domain names that impersonate legitimate exchanges, misspelled URLs, and not to download any apps that cannot be verified the legitimacy
Related: Beeple’s Discord URL ‘hijacked’, directing users to wallet drain
US law enforcement agencies have warned about pig butchering and romance scams on a number of occasions, and while you might assume the victims aren’t well-educated in technology or investing, that’s not always the case.
In June, it was reported that tech-savvy professionals in Silicon Valley were being duped by a wave of pork butchering scams in San Francisco, with several people losing more than $1 million each to this type of fraud financial
