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REPORT | Over 80% of All Investment Fraud Losses are Crypto Related, says Latest FBI Report

In 2023, the losses reported due to Investment scams became the most of any crime type tracked by the Federal Bureau of Investigation, the organization said in a report.

According to the report, investment fraud losses rose from $3.31 billion in 2022 to $4.57 billion in 2023, a 38% increase, with cryptocurrency investment scams playing a growing role at over $3.96 billion.

“Within these numbers, investment fraud with a reference to cryptocurrency rose from $2.57 billion in 2022 to $3.96 billion in 2023, an increase of 53%. These scams are designed to entice those targeted with the promise of lucrative returns on their investments,” the report said.

Overall, FBI says it received a record number of complaints from the American public: 880,418 complaints were registered, with potential losses exceeding $12.5 billion. This is a nearly 10% increase in complaints received and represents a 22% increase in losses suffered compared to 2022.

The second-costliest type of crime after investment scams was business e-mail compromise (BEC), with 21,489 complaints amounting to $2.9 billion in reported losses. Tech support scams, meanwhile, were the third-costliest type of crime tracked by FBI’s Internet Crime Complaint Center (IC3).

Notably, different age groups tended to be impacted by different crimes. Victims 30 to 49 years old were the most likely group to report losses from investment fraud, while the elderly accounted for well over half of losses to tech support scams.

In terms of crime by complaint counts alone, phishing/spoofing cases are way ahead at 298,878 complaints received in 2023 by the IC3.

Crimes related to the term ‘cryptocurrency’ saw 43,653 complaints that year [2023], and 25,815 involving ‘cryptocurrency wallet.’ When looking at the amounts of funds lost, complaints with the term ‘cryptocurrency’ were responsible for $3.8 billion while complaints involving ‘cryptocurrency wallet’ were worth $1.7 billion in funds lost.

Consequently, the FBI recently cautioned Americans about the risks associated with using unregistered cryptocurrency money transmission services

The federal organization asked American citizens to avoid crypto services from firms that are not registered as Money Services Businesses (MSBs) under federal law and do not follow anti-money laundering rules.

The FBI also cautioned individuals against making use of cryptocurrency services that do not request Know Your Customer (KYC) information, such as name or address, prior to allowing cryptocurrency transactions.

Additionally, it emphasized that apps available in app stores might not always adhere to federal compliance standards or support legitimate services.

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 5/11/2024

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