It seems like nothing is out of reach for crypto scammers. After phishing attacks, rug pulls, fake giveaways and several other elaborate schemes, cybercriminals are now turning to LinkedIn to defraud crypto investors.
In an interview with CNBC on June 17, 2022, FBI special agent Sean Ragan revealed that the networking platform had become a hotbed for illicit activities. He said that these crypto scams pose a “significant threat” to LinkedIn and its community members.
How do these frauds work?
Ragan explained that scammers create professional-looking fake profiles and strike-up conversations with hand-picked users via the in-built messaging feature.
The scammers initially direct victims to legitimate investment platforms in order win their trust. They build a relationship with the victim over several months before convincing them to move the money to a different platform, which is anything but legitimate and is usually operated by the scammer himself. Therefore, the money is lost as soon as it leaves the victim’s wallet.
“This type of fraudulent activity is significant, and there are many potential victims. There are many past and current victims as well,” Ragan said. A group of victims who came forward as part of the interview with CNBC disclosed that the amounts siphoned off ranged from $200,000 to $1.6 million.
Since LinkedIn is a trusted platform for business networking, victims tend to take messages from strangers a bit more seriously. After all, it is a platform for professionals to meet new people and build relations within their industry.
This method also seems to be an offshoot of the common honeytrap romance scams from popular dating portals. Only, instead of love, scammers use the guise of business, networking and job opportunities to build relations and trick users into parting with their hard-earned money or cryptos.
Microsoft-owned LinkedIn has a presence in over 200 countries with more than 830 million users globally. According to the Federal Trade Commission (FTC), money lost to such investment-related frauds amounted to $575 million between January 2021 and March 2022. LinkedIn also conceded in a statement that such fraudulent activity is becoming increasingly prevalent on its platform and that it is doing its best to tackle it.
So, what is LinkedIn doing about it?
To start with, LinkedIn has ramped up account screening and blocking. In 2021 alone, the company pulled the plug on 32 million suspicious accounts. In one of its reports, LinkedIn published that its automated cybersecurity systems stopped 96 percent of such fake accounts dead in their tracks between July 2021 and December 2021.
The system also red-flagged 11.9 million fake accounts during registration and identified 4.4 million malicious accounts while operating. These accounts were quickly blocked and taken down. LinkedIn also encourages users to file complaints and report such incidences so that they can be effectively managed.
“We enforce our policies, which are very clear: fraudulent activity, including financial scams, are not allowed on LinkedIn. We work every day to keep our members safe, and this includes investing in automated and manual defences to detect and address fake accounts, false information, and suspected fraud,” LinkedIn told CNBC.
What can investors do to avoid such situations?
Interacting with unknown persons on the internet is acceptable only until it is from a distance. Letting them into your financial matters is the equivalent of inviting a stranger into your home and trusting that nothing will disappear.
The FTC recommends the following tips if you want to interact safely on internet platforms such as LinkedIn:
-Do not fall for hefty returns: Only scammers will promise you high returns in unbelievably short time frames.
-No legitimate business will insist on cryptocurrency: It’s a glaring red flag if you’re asked to pay in cryptocurrency ‘only.’
-Romance and investment shouldn’t be united: If such an interest cajoles you into moving some of your cryptos to a different address, be sure to keep your distance. Romance scams have defrauded people of $185 million since 2021 and are the second most prevalent online scam after investment scams.