As fraud becomes more sophisticated, understanding emerging tactics is essential to helping protect your financial security.
In the age of artificial intelligence (AI), online scams are becoming easier to carry out — and harder to detect — than ever before. Among the most widespread and costly forms of fraud are cryptocurrency investment scams.
These schemes often target high‑net‑worth individuals and older adults, who may have significant financial assets. In 2024, the FBI’s Internet Crime Complaint Center (IC3) reported $6.5 billion in losses from investment scams, including $1.8 billion from victims aged 60 and older. Unfortunately, these scams continue to grow more sophisticated, with new tactics emerging each day.
How can you avoid investment scams?
1. Understand common tactics scammers use
Scammers frequently use digital platforms to initiate contact and build trust before introducing fraudulent investment opportunities.
- Social media: Fake job listings or investment ads are used to attract victims.
- Text messages: Scammers send “misdialed” texts or false job offers to spark a conversation.
- Dating sites: Fraudsters create fake profiles to establish emotional connections.
Scammers use these methods to build trust which may include initiating romantic relationships, sharing pictures of themselves, or emphasizing shared hardships stemming from divorce or the death of a loved one. Once trust is established, scammers promote investments that often include cryptocurrency, the promise of guaranteed profits, or rapid growth on fraudulent trading platforms. They may fabricate account dashboards or show false “returns” to pressure victims to invest more.
When victims attempt to withdraw funds, their accounts are frozen and additional “fees” are demanded — another tactic to extract more money. Ultimately, funds cannot be recovered.
2. Know how to identify red flags
These scams often include warning signs, but the promise of large returns can make them easy to overlook. To help protect yourself:
- Be skeptical of anyone promising quick or guaranteed profits.
- Be careful of an urgent request that aims to exploit human emotions.
- Always verify proposed investment opportunities using independent sources.
- Never send cryptocurrency as payment, especially in response to unsolicited messages.
- Do not take investment advice from someone you recently met on a dating app or other online platforms.
- Ignore and report unsolicited “investment managers” who contact you unexpectedly.
- Avoid clicking links sent via text, email, or social media, especially from unknown senders.
3. Take action
Staying informed and vigilant is your best defense against these increasingly sophisticated schemes. If you encounter suspicious activity, report it to the FBI’s Internet Crime Complaint Center (IC3).
If you believe your personal or financial information may have been compromised, consult your advisor or contact us immediately.
To learn more about common scams and steps you can take to protect yourself, visit the Wells Fargo Security Center or contact your advisor for additional resources to help protect yourself in a digital world.
