How to Avoid Scams
There are several actions you can take to steer clear of being scammed. Never click on links, dial a phone number, contact someone who reaches out about financial issues, or send them money. Also:
- Ignore requests to give out your private cryptocurrency keys. Those keys control your crypto and wallet access, and no one needs them for a legitimate cryptocurrency transaction.
- Shun enterprises that promise you'll make lots of money.
- Don't engage with investment managers who contact you and say they can grow your money quickly.
- Be wary of "celebrities" contacting you. A real celebrity won't reach out to you about buying cryptocurrency.
- Meet in person any romantic interests you are connected with on an online dating website or app. Don't give them money.
- Ignore text messages and emails from well-known or new companies saying your account is frozen or that they are worried about it and can help you "unfreeze" it.
- Contact a regulatory agency if you receive an email, text, or social media message claiming to be from a government, law enforcement agency, bank, financial institution, or utility company stating that your accounts or assets are frozen. Don't answer the initial correspondence through their means of communication. Instead, get details on how to connect from an agency's official website.
- Ignore job listings for cash-to-crypto converter or crypto miner openings.
- Scrutinize claims about explicit material a scammer may say they have about you that they threaten to post unless you send cryptocurrency. This is blackmail. Report it.
- Don't accept "free" money or crypto.
Your state might have a webpage that lists currency cryptocurrency scams. For example, the State of California's Department of Financial Protection and Innovation has a fantastic list of complaints it has received that can raise your awareness. You can find your state's consumer protection offices by visiting USA.gov's state consumer protection office search page.
How to Report Scams
Several organizations can help you if you’re a victim of a cryptocurrency scam or suspect one. Use their online complaint forms to seek help:
- FTC fraud report
- Commodity Futures Trading Commission complaints and tips
- Securities and Exchange Commission fraud reporting
- FBI Internet Crime Complaint Center complaint
You can also directly contact the crypto exchange you use. Find out if they offer fraud prevention or have other measures to protect your crypto assets and money.
How Can You Tell If Someone Is a Crypto Scammer?
Legitimate businesses will not correspond with you via social networks or text messages. They also will not ask you for your private keys to help you with an action. The best way to avoid a crypto scammer is to be wary of any communications sent your way and conduct research on every project to learn about the team behind it. If someone is attempting to scam you, it is likely they have tried it with others also. Search for the cryptocurrency using the word "scam" and see what you find. Visit official consumer protection sites like the FTC, FBI, and SEC. The State of California's Department of Financial Protection and Innovation has an excellent compilation of scam attempts with descriptions.
How Do Crypto Scams Work?
There are many ways these scams work, but most involve getting you to give your cryptocurrency private keys to someone in exchange for something else, like good returns or in an attempt to blackmail you.
What Are the Red Flags of Cryptocurrency Scams?
Some signs include pressure to not miss an opportunity, contacting you and asking for your private keys, or building a relationship with you before asking for cryptocurrency to help them. There are many scams, and more are being created—they are becoming increasingly sophisticated and realistic. Make sure to keep yourself up-to-date on all of the current scam tactics being used by reading about them on official channels.
