A recent report from the Irish Independent reveals that nearly 45% of all investment fraud cases in Ireland between January 2020 and August 2024 involved Bitcoin and other cryptocurrencies. The majority of these scams were perpetrated by criminals posing as investment managers. They often used tactics such as cloning legitimate websites and targeting victims through online and social media advertisements.

Staggering Financial Losses 

Between January 2020 and August 2024, scammers stole over €75 million (approximately $83 million) from more than 1,100 victims. The most significant losses occurred in 2023, with €28 million stolen—more than the combined total for 2021 and 2022. So far, in 2024, fraudsters have managed to steal €13.5 million.

A Typical Crypto Scam 

The report highlights a specific case where a victim was lured by a social media advertisement promising lucrative returns through a mobile app-based trading platform. After signing up, scammers contacted the victim and convinced him to transfer €45,000 (roughly $50,000). The fraudsters later claimed the investment had grown to over €727,000 (around $808,620) in profits, allegedly stored in USDC stablecoin within an Ethereum-based Atomic Wallet. However, when the victim attempted to withdraw the funds, he was told he needed to pay an additional $40,000 in "dirty tax" to access the money.

Understanding the 'Dirty Tax' Scam 

The so-called "dirty tax" is a fraudulent tactic where scammers claim victims must pay a fee or tax to unlock their funds or profits. This is a common ploy in investment fraud. In July, the Washington State Department of Financial Institutions issued a warning about similar scams, where victims were tricked into dubious crypto investments and then had their accounts frozen when attempting to withdraw profits. The scammers then demanded more money to release the funds.

Authorities Warn of Increasing Crypto Scams 

Michael Cryan, Detective Superintendent of the Garda National Economic Crime Bureau, emphasized that scammers often target "ordinary, decent people" and urged the public to exercise caution when transferring money internationally. The rise in crypto investment scams has become a global concern, with fraudsters luring victims with promises of high returns.

One of the largest crackdowns in recent times occurred when the Australian Securities & Investments Commission took down 615 websites linked to crypto investment scams. Additionally, Australia’s competition regulator sued Meta over a surge in Facebook advertisements promoting crypto scams.

Conclusion:

The surge in cryptocurrency-related fraud in Ireland highlights the need for increased vigilance and public awareness. As scammers continue to refine their tactics, both potential investors and authorities must stay ahead of the curve to prevent further financial losses.