US Citizens Lose $5.6B in Crypto Fraud: FBI Report

• The FBI reports that the US citizens lost about $5.6 billion in crypto frauds in 2023, up 45% from 2022.
• The report identified that the elderly were the most vulnerable and often victimized, with $1.6 billion lost.
• The crypto-related complaints accounted for 10% of total reports but 50% of the losses.

The FBI’s Internet Crime Complaint Center has released a sobering statistic: Americans reported a staggering $5.6 billion in losses due to crypto fraud in 2023. This represents a 45% increase from the previous year, highlighting the growing threat of crypto scams.

Crypto-related complaints accounted for 10% of all reports to the FBI, but the financial impact was disproportionately high, representing 50% of the total losses reported for the year.

Elderly Particularly Vulnerable to Crypto Scams

With nearly 70,000 complaints of crypto fraud, losses in 2023 soared 45% compared to 2022. The report found the elderly were especially targeted, accounting for almost $1.6 billion of the losses. Investment schemes were the most prevalent, making up 71% of crypto fraud, followed by call center fraud and impersonation scams.

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FBI assistant director Michael Nordwall noted the alarming rise in crypto scams. He explained that crypto’s decentralized nature, speed, and borderless transactions make it “an attractive vehicle for criminals.” He added that the same reasons have made it challenging for investigators to recover stolen funds.

The US topped the list of over 200 countries reporting crypto fraud complaints, with the highest number of cases and losses. The report revealed that scammers often use dating apps or social media to build relationships with their targets.

FBI Warns of ‘Pig Butchering’ and Other Scams

The FBI urged investors to stay vigilant against growing threats like “pig butchering” scams. “There is one thing these scammers typically will not do — they will not meet with you in real life. If an investment opportunity comes from someone you’ve never met in person… be extremely cautious,” they advised.

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Americans are also vulnerable to labor trafficking, where individuals are tricked into taking jobs abroad that turn out to be exploitative. This is sometimes linked to “pig butchering” scams, often run from call centers using coerced foreign labor.

The FBI also identified other scams targeting US citizens, such as play-to-earn and crypto recovery scams. With the former, scammers charge users for tokens then freeze accounts and steal their money. And in the latter, they prey on victims of previous scams, promising to recover their funds but stealing more instead.