A retired nurse from Buffalo, NY, who wishes to remain anonymous for personal reasons, recently spoke about how she was tricked into handing over $43,000 to a Bitcoin scammer after seeing a pop-up on her work computer. She sent the money via wire transfer and to a “Bitcoin ATM” that transfers money into digital currency.
The authorities say it was part of a phishing scam where hackers remotely take over someone’s computer and tell them their finances have been stolen. The victim is told they have to move their money into a secure account, but they are never given access. These kinds of scams are becoming more common throughout the U.S. as bitcoin surges in popularity.
A Costly Mistake
The nurse said the scammers told her to call a real phone number. She was connected with someone who told her that her financial credentials had been compromised and that she needed to move her money to a secure location to save it.
She sent a total of $43,000, including $13,700 to a bank in East Asia and $29,430 into a bitcoin ATM. The ATM is supposed to convert the money into bitcoin that lives in the person’s digital wallet, but when the nurse scanned the barcode on the ATM, it sent her money to somewhere in Kolkata, India.
Experts say it’s never a good idea to send your money to a third-party, including cash and cryptocurrency.
“Zero percent of the time is that legitimate,” said Todd Maher, president of BitSource AML Solutions, a financial crimes consultancy agency.
The nurse was using her work computer at the time. When her employer found out, they blamed her for giving the hackers access to the device and subsequently fired her as a result.
Older individuals, including retirees, tend to be more susceptible to these kinds of phishing scams.
“This is organized crime. She is up against a sophisticated criminal operation,” said Kathy Stokes, director of fraud prevention at AARP. “They got the money, the time, the playbook, they have employees, and it’s us against them.”
People are also more likely to fall for these scams when they are working remotely or isolated from other people.
“If you feel yourself getting excited or upset from an email, phone call or whatever, try and connect that with: ‘OK, I have to be skeptical here,’ because once [thieves have an in,] it’s hard to back out,” said Stokes. She says it’s best to avoid interacting with mysterious pop-ups. If someone receives a concerning message, they should see an IT expert as soon as possible.
Cryptocurrency has helped fuel a new era of cybercrime. Hackers will often find a way to get paid in bitcoin and other digital currencies to cover their tracks. They can earn money anonymously and bitcoin ATM transactions can’t be reversed.
“It’s not her fault,” Stokes added. “[Hackers] know what to do to get us under a highly emotional state. They call it ‘getting under the ether.’ Could be fear, love, excitement.”
Hackers and thieves made off with $24 million in bitcoin during the first six months of 2020 alone.
The Twitter bot Whale Alert automatically tracks cryptocurrency transactions online. The creators partnered with Scam Alert to produce a “crime reporting, tracking and analysis” report.
“There are dozens of different types of scams such as giveaways, sextortions, fake exchanges, fake ICO’s, bitcoin recovery, video scams, Ponzi schemes, fake tumblers, malware and the list goes on, but there is one thing all of these scams have in common: for the criminals, there is almost no risk involved while victims’ lives are being destroyed,” Whale Alert wrote online.
The nurse filed a police report, but there’s little chance that she will get her money back, not to mention her part-time job.
Many new investors are getting into cryptocurrency as well. Experts say people need to use caution when transferring their money into Bitcoin. Individuals need to make sure the ATM isn’t transferring the money into a separate account.
“There’s always going to be scams, there’s always going to be bad people,” said Maher. “The best thing we can do is make sure the Bitcoin ATM companies are doing what they say they’re doing.”