LINCOLN, Neb. (KOLN) – The Lincoln Police Department is investigating after a man says he lost hundreds of thousands of dollars in a cryptocurrency scam.
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On Friday, LPD said a 56-year-old man reported a fraud to police, explaining that he’d been communicating with a stranger since early December.
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According to LPD, the man said the caller encouraged him to join a group message on the Telegram app for cryptocurrency trading.
Police said the man completed cryptocurrency trades and made a return, and the stranger then encouraged the man to up his investment to increase his return.
LPD said the man then invested an additional $300,000 and then received notice that his account was under audit.
The controller of the group advised the man that he could unlock his account with additional funds, police said, and he added an additional $50,000.
LPD said the man was then advised that he needed to give more funds.
The victim explained to police he believed he was being scammed.
Investigators said the total loss is $350,000.
How to avoid a cryptocurrency scam
According to the Better Business Bureau, cryptocurrency accounted for the second highest scam losses reported to the Federal Trade Commission in 2021, with losses of $750 million.
- Guard your wallet. If you buy cryptocurrency, the security of the wallet is of prime importance. If you lose the key, then your funds are gone permanently.
- Look carefully at email addresses and website addresses. Phishing scams often try to trick people into logging in and then capture the log in credentials. Those then can be used to steal money. Looking for an exchange with an internet search engine may lead to fake sites which advertise and impersonate real companies. Be especially careful when viewing these on a phone.
- Do not pay for products with cryptocurrency. Be careful if someone asks you to pay with Bitcoin or another cryptocurrency. No one with the government will ever ask for this form of payment.
- Beware of fake recovery companies. Scam companies sometimes claim that they can recover stolen money – for a fee. These are usually scammers.
- Watch out for fake reviews. Scammers often create fake reviews for their own companies.
- Be wary of celebrity endorsements. It can be tempting to rely on a prominent figure who has invested in cryptocurrency. But those endorsements are often not authorized and even if they are, the celebrity may be paid for the effort and may not know more about it than you do.
- Be careful about claims made on social media. This is the most common place for people to encounter investment scams.
- Be wary of “friends” who reach out to you on social media and tell you how they made money with cryptocurrency. Accounts are frequently compromised. Call your friend by phone to see if it is really them.
- Only download apps from Google Play or the App Store. Trusted app stores do not eliminate the threat of app scams, but they do offer a basic level of protection. Be careful with apps. Some contain malicious software.
- Do not believe promises of guaranteed returns. No one can guarantee how an investment will perform.
- Seek help and support. Cybercrime Support Network offers a free, confidential support program for romance scam survivors.