According to a report from the Australian Competition and Consumer Commission (ACCC), the Australian population has lost around AU$61 million (US$42 m) to investment scams in 2019 alone.
The data showcases every aspect of investment scams and not only cryptocurrencies, stocks or fiat currencies. The scams have been accumulated starting in January 2019 all the way to Christmas 2019.
Up until December 2019, the number of investment scams reported was around AU$49 million, meaning that a large chunk of the defrauded funds was taken hold of during holiday seasons before the end of the year.
These are just estimates
According to the ACCC, there have been a lot more reports in the year 2019, but this doesn’t mean that the investment scams have gotten worse over the years. The increasing number of reports may simply be due to the involvement campaign that the commission undertook during the year, encouraging victims to report their misfortune and help the ACCC track all of the current events.
The report tells us that nearly 5000 people reported the crimes, which means that the total number of defrauded funds is just an estimate. Should it be the accurate number it would mean that each reported case took hold of AU$12,200 on average.
The same report mentions that most of the defrauded funds were siphoned using the age-old method of simply cold-calling the investors.
Calling tactics have been around pretty much ever since the phone was invented. The potential victim’s phone number is purchased by the scammers and later delegated to an operator. The operator contacts the victim and tries to come across as a legitimate representative for a registered financial company.
Sometimes, the victims do the scammers’ jobs for them and contact them on their own accord. This leads to billions of dollars of wire fraud all over the world.
Although it had not been reported in the ACCC’s paper, many Australians have mentioned how they’ve been defrauded by online entertainment platforms as well, especially when dealing with cryptocurrencies.
The tendency of crypto scams
You see, when the first Australian online bitcoin casino started accepting cryptocurrencies as a legitimate method of making a deposit, almost every casino in both the online and offline markets started to copy them simply because it was very lucrative.
It took only a couple of months for fraudulent platforms to get accustomed to the same methods as well, leading Australian investors and gaming enthusiasts towards a trap.
Other crypto-related scams include Initial Coin Offerings, the same as anywhere else in the world and several botched Bitcoin ATMs dotted around the country. Regardless of how it may seem, the crypto space is very dangerous not only in Australia but the whole world.
This is one of the reasons why governments insist on introducing limiting crypto regulations, where every single company dealing in blockchain technology has to register with the local government for a license, thus sending a signal to investors that they are legitimate.
However, over the years, faking a license has become easier and easier. In fact, simply saying that the company has a license is sometimes enough for most investors to deposit funds without checking. Other methods include cloning a licensed firm and trying to come across as the original brand.
Manipulating a disaster
Several Australian Reddit users have also mentioned that some fraudulent companies or individuals have started charity programs involving cryptocurrencies. Most of these charities are connected to the Australian bushfires, which have been raging on for quite a while now.
According to those Redditors, the charities try to convince people that they are gathering funds as a way to help the firefighters, pay their salaries, or re-plant all the trees and flora that got burned during the disaster.
Although this information has not been confirmed yet, there are mentions that several charities simply disappeared after reaching 50% of their initial goal and have not updated the donors on where the funds were spent and how they were utilized.
As of now, it’s best to participate in Australian bushfire charities with a method that can be tracked and measured with the local authorities.