With the popularity of crypto-currencies like BTC (Bitcoin), more scammers and crooks are targeting BTC exchange networks on the Web this year. They’re out to victimize beginner BTC traders and new sellers who aren’t quite familiar with how the most popular exchange platforms work. A lot of scammers use fundamental tactics and schemes that they’re known to perpetuate for committing other types of Internet fraud.
Because most online exchange brokers that sell BTCs have strict manual buyer verification procedures, many fraudsters go to peer to peer exchange platforms. That’s because they find it too cumbersome to circumvent the security protocols and manual user identification systems of BTC brokerage firms. They instead target peer to peer BTC sellers, specifically those who have recently signed up and registered for an account at some of the most popular BTC exchange networks on the Web today. They then trick their targets through variations of standard Internet fraud tactics and schemes.
Found below are some of the most widely used Internet fraud schemes that are performed by scammers to victimize beginners and new BTC sellers in peer to peer exchange networks. Watch out for these scams in case you regularly trade in similar online BTC trading platforms:
What Internet Fraud Tactics Do Scammers Use to Commit Bitcoin Scams?
- Spoofing & Phishing – This Internet fraud tactic is used by scammers to trick users into believing that they’re being contacted by the administrators of a peer to peer exchange platform where they sell BTCs. They’re then fooled into going to a site that looks exactly like the official trading site.
Many scammers integrate fake urgency claims and scare rhetoric into these spoofed emails, private messages, instant messages and SMS texts to lure users into their Internet fraud schemes. For example, some victims have recently reported in BigScammers.Com that they were asked to log into their accounts to update their security settings and profile details. They are told to do this to avoid possible security breaches as reported by other users.
Once they enter their private login credentials into these fake sites, the scammer goes to the official trading platform to log into the victim’s account. The fraudster then cleans out all the BTCs of the victim by sending everything to the scammer’s BTC address. Since these transactions are anonymous and irreversible – There’s no way for the victim to recover the BTCs that he or she lost because of this Internet fraud.
- Stolen Credit Cards & Hacked Bank Accounts – Some sellers in these peer to peer exchange platforms accept credit cards and electronic fund transfers as a form of payment for the BTCs that they’re selling, which is usually with a very high mark-up. They often use payment gateways to process transactions. What they don’t know is that they’re supplied with fake identity documents that match the names and billing addresses of the cards these scammers use to buy their BTCs. This is similar to other types of Internet fraud where stolen credit cards and hacked bank accounts are used to purchase expensive products from ecommerce stores.
Sellers soon learn that they’ve been victimized by this Internet fraud when they get chargeback claims and unauthorized payment alerts from legitimate card holders and bank account owners. Many of them even lose their ability to accept online payments because of this problem.
By remembering these tips, you’ll be able to devise ways on how you can avoid these Internet fraud tactics during your day-to-day activities in these peer to peer BTC trading platforms. You should also sign up at BigScammers.Com to learn the newest schemes that could potentially trick you into parting with your BTCs.