A man from Eden Prairie, Minnesota, has fallen victim to a crypto scam that cost him over $9 million. The scam involved a LinkedIn connection who lured him in with promises of quick riches and professed love. 

LinkedIn Love Or Crypto Catastrophe?

According to a report by StarTribune, the victim was directed to make large deposits from his U.S. Bank account into accounts with other banks for cryptocurrency investment. However, the investments he believed would yield big returns became part of a fraudulent scheme.

The police investigation revealed that the man’s money went into encrypted digital crypto wallets that only the scammers controlled. 

The suspects never invested the victim’s money on his behalf but instead used it to purchase cryptocurrency on their behalf. The man believed he was investing in “Coinrule-web3” and saw a quick profit in his investment, leading him to believe everything was legitimate. However, he was told he needed to pay a $2.8 million fee to collect his windfall.

On June 15, the victim’s wife alerted the police that her husband had been liquidating their investment accounts for the past six months. She said her husband “called her in a panic” the previous day and told her to withdraw all their remaining assets to pay the fee so he could cash in his crypto funds. 

Per the report, police determined that Coinrule-web3 is associated with numerous “crypto and romance scams.” One of the banks that received the deposits, Metropolitan Commercial Bank of New York City, is commonly used to launder stolen money.

The Eden Prairie police have declined to reveal anything about the couple in this investigation or offer an update on progress toward an arrest or charges in what they say is one of four cryptocurrency fraud cases they have investigated so far this year. 

Losses on crypto fraud tend to be significantly greater than other types of fraud, according to the Minnesota Attorney General’s Office.

In 2022, investment fraud topped the list of the highest losses of any scams reported by the public to the FBI’s Internet Crimes Complaint Center, tallying $3.31 billion in losses. 

Frauds involving cryptocurrency represented the majority of these scams, increasing 183% from 2021 to $2.57 billion in reported losses last year. The FBI has found that many of these reported frauds came from victims ages 30 to 49.

Cryptocurrency scams are becoming increasingly sophisticated and prevalent, often preying on people through social networking and online communications platforms, dating websites, and phone calls and text messages that appear to have been misdialed. 

Law enforcement officials advise people to watch closely for website domain names that impersonate legitimate financial institutions and refrain from downloading or using suspicious-looking apps as tools for investing. 

Before buying digital currency, carefully research what is being offered and who is offering it. Victims of a cryptocurrency investment fraud scheme are encouraged to report it as soon as possible to the FBI’s Internet Crime Complaint Center, a local FBI office, and the legitimate financial institution involved.

Featured image from Unsplash, chart from TradingView.com