Bulletins

Crypto scammers have made off with at least $1 billion since 2020

Most of the frauds focus on fake promises of huge investment returns.

A man in front of a computer, holding a credit card, looking upset with his hand over his eyes

Online fraud is frustrating consumers.

Photo: fizkes/iStock/Getty Images Plus

The crypto craze keeps getting bigger — with fraudsters.


Consumers lost more than $1 billion in crypto to scammers between the beginning of 2021 and March 31 of this year, according to the Federal Trade Commission. The problem is accelerating, too: An FTC report released Friday found that people were scammed out of $329 million in just the first quarter of 2022, nearly half of what they lost during all of the prior year.

Most of the duping — totaling $575 million — came in the form of phony investments, frequently guaranteeing eye-popping returns. Some even came with fake dashboards to track "growth" or offered of small test withdrawals designed to fool consumers into trusting the schemes, the FTC said.

Often these scams started on social media, and nearly 40% of all money lost on social media went out the door in the form of crypto. After investment scams, people lost the most crypto to fake romances. (Seriously, stop paying your web crushes.)

Overall, the median loss among 46,000 reports to the FTC was $2,600. People between the ages of 20 and 49 were three times more likely to have reported falling for crypto frauds than older consumers, although the median loss for people in their 70s reached nearly $12,000.

Other reports worldwide have found similar stark increases in scams. Last year, the losses were 60 times what they were in 2018, the FTC said. In a similar report a year ago, the FTC found that losses were just $80 million over the period from the last quarter of 2020 into the first of 2021. One swindle detailed by the FTC at the time involved scammers posing as celebrities like Elon Musk.

The FTC isn't alone in its concerns about crypto, even when it's legitimate. On Friday, New York Attorney General Letitia James warned would-be investors that cryptocurrencies are volatile assets that can "yield more anxiety than fortune.”

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Payactiv gets paid back through a payroll deduction from the employee’s next paycheck. The company makes money through fees.

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The move underlined the CFPB’s increasingly critical view of sandbox deals that the agency said “proved to be ineffective.”

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Bulletins