FBI Warns of Cryptocurrency Scam Involving Crypto ATMs

Isabella James, Tech Times 06 November 2021, 08:11 am

The Federal Bureau of Investigation (FBI) has warned about a new cryptocurrency scam that involves crypto ATMs. The scam has been likened to a wire transfer fraud with a cryptocurrency twist.

The scam involves some scheme that leads to victims being directed to make payment transactions via physical cryptocurrency ATMs and digital Quick Response (QR) codes.

FBI Warns of New Crypto Scam

The FBI has warned the public about a new cryptocurrency scam that involves physical crypto ATMs and digital QR codes.

According to a public service announcement (PSA) posted online by the FBI, "The FBI has seen an increase in scammers directing victims to use physical cryptocurrency ATMs and digital QR codes to complete payment transactions."

Per a report by The Verge, the victim of this new scam is convinced by the scammer to deposit cash into a physical cryptocurrency ATM. After that, the victim is then directed to send the purchased coins via a QR code.

The Verge's report has likened the new crypto scam to a wire transfer fraud with a tech twist.

How the New Crypto Scam Works

According to the FBI's PSA, this new cryptocurrency scam usuallyy involves one of the following schemes:

Impersonation schemes - scammer pretends to be someone from the government, a utility company, law enforcement, and other similar groups and companies
Romance schemes - scammer builds a fake relationship with the victim
Lottery schemes - scammer fools the victim into believing that he or she has won a prize and insists that fees have to be paid to claim the prize

The scammer then convinces the victim to withdraw money from the victim's financial account. The money is then used to purchase cryptocurrency through a physical crypto ATM.

Once the purchase has been made, the victim provided "a QR code associated with the scammer's cryptocurrency wallet for the victim to use during the transaction," according to the FBI.

How to Protect Yourself From This Crypto Scam

The FBI has listed a few steps the public can take in order to protect themselves from cryptocurrency scams such as this.

The public is advised to avoid crypto ATMs that "advertise anonymity" and only require an email address as well as a phone number. According to the FBI, it is possible that these crypto ATMs do not comply with the regulations of the United States.

The FBI also advises not to respond to callers using unknown phone numbers who ask for cryptocurrency. The same advice is given with regards to callers who claim to be from the government or any company and likewise demand cryptocurrency.

It is also being advised that payments should not be sent to people you have only spoken to online and do not personally know.

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Written by Isabella James