Spain's National Police Warn Of Surge In Cryptocurrency Scams
Spain News
Published: 19 October 2021 12:53 CET
Spain’s National Police force has issued a warning following a sharp increase in the number of cryptocurrency investment scams.
Investment in Cryptocurrencies such as Bitcoin and Ethereum is becoming more and more popular and in recent years this has resulted in a large spike in the number of crypto-related scams circulating online.
The number of complaints made in Spain has increased dramatically in recent months with courts being flooded with cases relating to digital currencies. Two recent cases reported to the police in the Navarra region highlight the issue with the investors from Pamplona and Tudela being defrauded out of €240,000.
The National Police point out that the issue has arisen due to the increase in the number of online companies that have flooded the internet offering a high level of guaranteed returns for the promise of very little risk.
In order to guarantee such returns, the companies ask for large amounts of money as an investment. Many of the companies pass themselves off as authentic by developing social media pages and profiles with thousands of followers giving the impression of legitimacy. However, in most cases, the followers are not genuine and are there solely to act as a form of social engineering.
After they have managed to lure victims into parting with their money, the digital platforms they invest in show a supposed growth in the capital they have been duped into investing.
Many victims are attracted to such high returns for very little risk. In many cases, they are invited to make a small tester investment so they can see just how profitable the investment is with their investment rising by 20% on day one, 50% on day two and rising to 80% on the third day.
The victim can then withdraw their original funds which then helps to build trust in the financial instrument and prove its legitimacy.
Only when they attempt to withdraw their cash, do they find out that it is impossible to do so. Investors are then asked for further deposits in order to withdraw their original investment.
In one of the Navarra cases, the victim invested around 120,000 euros and saw their money grow to around 1.5 million. However, the supposed return wasn’t real and was just a ploy to get them to invest more.
How can you avoid being a victim of financial scams?
The National Police explained that this form of scam highlights how sophisticated fraudsters have become, especially in the art of social engineering and building relationships with their victims without raising suspicion
The police stress that it is crucial that you undertake sufficient due diligence and ascertain that the company and platform you are potentially going to invest your money into is legitimate and reputable.
They also recommend that users check that the companies are solvent and they are not mentioned in any official alerts issued by the authorities on investment platforms.
In the event that an investor does get caught out by such a scam, the police recommend filing a complaint with the authorities immediately as the “immediacy in the detection of the crime committed facilitates its investigation.”
If you want to report a crime you can do so 24 hours a day at one of the National Police offices or by calling 091.
Source
https://news.bitcoin.com/national-police-spain-warn-of-surge-cryptocurrency-related-scams/
https://www.20minutos.es/noticia/4851922/0/la-policia-nacional-alerta-ola-estafas-criptomonedas/
