Investor.gov (SEC Office of Investor Education and Advocacy)
5 Ways Fraudsters May Lure Victims Into Scams Involving Crypto Asset Securities
The alert describes fraudsters who pose as friends, move conversations off the initial platform and ask victims to pay with crypto assets.
Some investment scams start as friendly conversations and end with a request to pay in crypto assets. This page summarises one US investor alert that describes those steps. The alert concerns crypto asset securities, not binary options, so this page uses it as a general warning. It does not name or assess any firm.
How the Contact Begins
The alert, dated 29 May 2024, describes the opening: "They may pretend to be an old friend or claim to have contacted you accidentally." It then describes the next step: "The fraudster may quickly move communications with you away from the initial platform." Moving the chat elsewhere can make it harder for the original service to notice or act on the contact.
Larger Sums and Crypto Payment
The alert says: "The fraudster may then ask you to invest larger sums of money." On payment method it advises: "Keep in mind that an investment may not be legitimate if you are required to pay for it with crypto assets." It also warns: "If you pay, however, you are unlikely to receive your initial investment and will also lose the additional payment." The last sentence echoes the fee pattern in withdrawal fee scam warnings.
What the Alert Advises
The alert says: "Never make investment decisions based solely on information from social media platforms or apps." For the same advice about messaging apps, see trading group chat scam warnings and social media scam ads. If you have already paid, read how to report a binary options scam.
Frequently Asked Questions
How does the alert say contact may begin?
The alert states: "They may pretend to be an old friend or claim to have contacted you accidentally."
What does the alert say about paying with crypto assets?
It states: "Keep in mind that an investment may not be legitimate if you are required to pay for it with crypto assets."
Is this alert about binary options?
No. It concerns crypto asset securities, and this page applies it as general guidance about online investment scams.
Does this page address whether an individual could face liability?
This page summarises what the regulators' published guidance says. It does not address whether an individual could face liability. Seek independent legal advice.
Sources and Official References
- Investor.gov: 5 Ways Fraudsters May Lure Victims Into Scams Involving Crypto Asset Securities (29 May 2024)
This page summarises what the regulators' published guidance says. It does not address whether an individual could face liability. Seek independent legal advice.
This page summarises what the regulators' published guidance says. It does not address whether an individual could face liability. Seek independent legal advice.