US State Agency Warns of Rising Crypto Scams on Popular Social Media Platforms

Recently, the state’s financial regulator, the Department of Financial Regulation (DFR), issued a warning to Vermonters about the growing number of cryptocurrency investment scams on widely used social media platforms.

The Vermont Department of Financial Regulation (DFR) has attributed the surge in cryptocurrency scams to sophisticated scammers employing increasingly sophisticated and customized tactics, using layers of deception to lure victims.

As such, Vermont residents are urged to immediately report any incidents of fraud to help minimize financial loss and facilitate the identification and pursuit of perpetrators.

Instagram: The top platform for cryptocurrency fraud identified by US agencies

Naum Lantsman, 74, fell victim to a cryptocurrency scam via two prominent social media platforms last month that cost him $340,000 of his life savings.

Lantsman's life took an unexpected turn due to the impact of the pandemic, and he found himself interested in investing in cryptocurrencies. While casually browsing social media, Naum Lantsman came across a post from a company called SpireBit.

His initial encounter with cryptocurrency scammers took place on Instagram, which the Federal Trade Commission (FTC) has identified as a major platform related to cryptocurrency fraud.

Out of curiosity, he decided to get involved and connected with cryptocurrency scammers. The post described SpireBit as an "international financial broker" dealing in cryptocurrencies that lured Naum into the scam.

After the initial contact, a company representative who identified himself as Pavel contacted the messaging app Telegram. He writes in Russian, Lantsman's native language.

Pavel and Lantsman began talking regularly, discussing family matters and their shared background in the former Soviet Union. All these interactions take place via Telegram.

For days, SpireBit executives pressured him, eventually convincing Lantsman to invest against his wishes. Lantsman started with $500 and eventually put his life savings (totaling over $340,000) into the SpireBit account.

Lantsman's account shows the money being deposited and increasing. However, the chart showing earnings growth is completely fake.

When he tried to withdraw funds from the account, SpireBit presented a forged document purportedly from the UK-based Barclays Bank, demanding a 2% fee as a “safety measure.” A Barclays representative later confirmed the document was a forgery.

Although Lantsman knew about cryptocurrency scams from previous accounts, he said he never expected to fall prey to such criminal activity.

The Vermont Department of Financial Regulation (DFR) highlights that scammers employ ever-changing tactics to carry out their fraudulent schemes, such as falsifying bank documents and engaging in friendly conversations.

To combat these tactics, vigilance and thorough background checks are crucial. Investors are advised to conduct extensive research before investing in digital asset platforms.