The lure of quick riches has plagued humankind for centuries. Who doesn’t want to get rich quickly? In the past, con artists duped unsuspecting “marks” using small classified ads in newspapers and magazines, then graduated to email and the web, and now to social media.
Although people of all ages are susceptible, the younger generation seems to be more trusting than usual, especially on social media. Moreover, the proliferation of cryptocurrencies has added an extra spark to get rich quick schemes, as the following scenario shows.
A Tale Of Young Greed And Inexperience
18-year-old Jason has been watching the rise of bitcoin for months. He was super excited at how easy it was to invest in cryptocurrency and win big. So, he decided to open an account and invest some of the money earned working part-time at the local grocery store.
Investing in cryptocurrency can be rewarding when you win and nerve-racking when you lose. Jason quickly found that investing is not a sure thing. Still, he kept adding to his account and received modest gains. So, things were going well.
When on social media one day, Jason saw a post by a famous influencer he was following. The post guaranteed to triple anyone’s cryptocurrency returns in one week—they had a proven method that couldn’t fail.
Lured by the prospect of quick riches, Jason quickly opened an account and transferred the cryptocurrency balance from his existing account. He even added more; after all, he couldn’t lose.
After opening the account, Jason waited patiently. A week went by; then, two weeks. He didn’t see any returns. He didn’t see any communications at all. Finally, he tried logging onto his account but couldn’t connect. What’s going on?
Jason then logged on to his favorite social media site to investigate and hopefully inquire about his money. Then he saw a post from the very influencer who convinced him to invest—his account was compromised, and a criminal published the bogus cryptocurrency post—it was a scam!
Jason lost all of his money—but it doesn’t end there. Jason also entered detailed personal information onto the website to open the bogus account. As a result, the criminal now had Jason’s confidential data.
Although embarrassed, Jason was forced to tell his parents. That’s when they discovered that Jason’s bank account was cleaned out. Jason’s parents immediately contacted law enforcement, but they could do little since the scammer was operating from another country.
Jason and his parents braced themselves for the coming identity theft scams that were sure to follow.
Did You Spot The Red Flags?
- The influencer claimed they could triple any investment within a week. Anytime you see a claim like this—run away because it is sure to be a scam.
- Jason was too eager to make a quick return. But, unfortunately, greed is a powerful emotion, and it is precisely what scammers rely on.
- Jason didn’t ask his parents for advice BEFORE he invested with the bogus company. Had he done so, Jason’s parents would have most likely advised him to stay away, recognizing the post as a scam.
The above is an example of a cryptocurrency multiplier scam, where the bad guys promise to multiply deposits for quick profits. Instead, Jason’s money went right into the scammers’ coffers.
Cryptocurrency multiplier scams are popular on social media because the young, inexperienced users hang out there, and cryptocurrency is the latest craze. In addition, impersonating celebrities and influencers adds an air of legitimacy that some people, especially the young, can’t resist.
The best defense is education. This is where parenting comes into play, giving sound advice to their children. No doubt kids are tech-savvy, but are seemingly too trusting of what they see, read, and hear on social media.
Parents, teach your kids about sound investing. Today’s schools do not do enough of that, if at all. It is up to you to point them in the right direction.
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