BALTIMORE — Cryptocurrency is more widely known, but still misunderstood costing consumers billions of dollars. A Maryland man recently fell into this trap after receiving a text from a stranger.
It came from an unknown number and included a photo of a young woman.
“Sorry, wrong person,” the man texted back.
But that didn’t seem to matter.
“Chit chatting about family and where we've been, what we kind of do during our lives,” he said.
Then the topic took a turn.
“How long did it take for her to start talking to you about investments and crypto?” Mallory Sofastaii asked him.
“It was probably about a week. It was a gradual build up,” he said.
We're not identifying this man because he's concerned that sharing his experience could impact his employment, but he wants to warn others about how these scammers ensnare investors.
“I personally just don't want to work for the rest of my life, so I'm trying to build some sort of a nest egg. Everything sounded very convincing as far as this is how it works, these are short-term, you can make money up or down depends on how the market goes,” he explained.
The woman claimed to be a leader in the field of investment, majoring in economics, and would teach him how to get the biggest returns.
“She walked me through how to transfer funds over. Eventually, I transferred over $35,000 on two different transactions,” he said.
And it appeared to have paid off.
“So I made about $150,000,” he said.
“Your original $35,000 investment had turned into over $100,000?” Sofastaii asked.
“Oh, yeah,” he replied.
“What timeframe?” Sofastaii asked.
“A month, A month timeframe,” he said.
But when he tried to cash out, he was told he'd have to pay more than $30,000 in taxes.
“And I had 10 days to come up with this money or they were going to tax me 5 percent daily. If I didn't do anything, they said they would consider me just walking away from it. So yeah, I had to walk away from it. So basically, I lost about $35,000,” he lamented.
The trading platform had a similar name to GMO (Grantham, Mayo, Van Otterloo), a global investment firm. A spokesperson for the real GMO said the website/platform was not affiliated with the investment firm, and sent a link to a warning on their website about fraudsters using their name and reputation to scam prospective investors.
“Losing that money, what does that do to your retirement plan?” Sofastaii asked.
“Well, it postpones it for a significant period of time. Yeah, it flat out hurts,” he responded.
By answering the phone or responding to a text from someone you don't know that's signaling to the scammer that your number is active. The best thing you can do is not answer and delete the message.
Keep in mind, no legitimate business or government agency will demand payment in cryptocurrency. And only scammers will guarantee profits or big returns.
Click here for additional information from the Federal Trade Commission on cryptocurrency scams.
