Data collected from consumer complaints helps us understand the consumer experience and spot larger trends we may need to investigate. Recently, the DFPI launched a new online Self Service Complaint Portal to improve the consumer complaint process and resolution response time. This new interface allows the DFPI to collect more comprehensive consumer data which, in turn, informs our policy, rulemaking, and enforcement activities.
A third-quarter 2023 CSO report indicated a rising trend in crypto-related complaints. Below are examples of the most common crypto-related complaints received by the DFPI:
- Consumer with an account with a legitimate crypto exchange site is scammed into transferring their crypto assets to a fraudulent platform/wallet. The consumer files a complaint against the company stating they should have done more to prevent fraudulent activity from occurring on their app.
- Consumer transfers crypto to an unknown wallet and loses access to his funds.
- Consumer is persuaded to send or “invest” US dollars into a crypto investment. The consumer transfers funds directly from their U.S. bank to the scammer’s platform, wallet, or bank. When the consumer identifies being scammed, she files a complaint against their bank stating the bank should have done more to prevent fraudulent activity.
- Consumer invests in a cryptocurrency investment opportunity. The person receives a profit and then are asked to invest more. Upon investing more, the consumer is unable to withdraw the profits. The scammers abandon their fraudulent website and disappear.
- Consumer with an account on a legitimate exchange site and has concerns regarding a transaction or account activity. This is not a scam, but consumers have the right to submit a complaint against a legitimate crypto platform.
- Consumer with a crypto asset complaint regarding the investment advice of a DFPI-licensed Investment Advisor. Again, this is may not be a scam, but consumers have the right to submit a complaint against a DFPI-licensed investment advisor.
- Consumer is approached via text message or email from scammer. The scammer sends text or email messages to the consumer as if they know one another. The savvy consumer responds with a wrong number or wrong person reply. The scammer replies and keeps communicating with the consumer and eventually persuades the consumer to transfer their crypto assets to a scam site.
- Consumer is approached through social media (sweetheart scam). The scammer is perceived to have a legitimate interest in forming a romantic relationship with the consumer and convinces the consumer to send them cryptocurrency.
Protect Yourself from Crypto Scams and Fraud
Be careful what you post and make public online. Scammers can use details shared on social media and dating sites to better understand and target you. Be especially cautious about online crypto-related investment offers. If it seems too good to be true, it probably is. Go slowly, ask questions, and do your own research.
If you suspect a scam, protect yourself and your money by following these tips:
- Stop communicating with the person immediately.
- Block them on every platform they’ve used to communicate with you. This will keep them from seeing your profile or messaging you again.
- Talk to someone you trust. Are your friends or family concerned about your new love interest or your enthusiasm for a sketchy investment offer?
- Search online for the suspected scammer’s name or occupation, plus the word “scammer.” For example, search for “oil rig scammer” or “U.S. Army scammer.” Have other people posted similar stories?
- Do a reverse image search of the person’s profile picture. Is it associated with another name or details that don’t match up? These are signs of a scam
The DFPI has a Crypto Scam Tracker to inform consumers of the latest trends in crypto-related scams and fraud. You can search the database by company name, scam type, or keywords to learn about the specific complaints the DFPI has received. There is also a glossary explaining the structures for common scams. As new scams emerge, the DFPI updates this list.
If you think you’ve been the victim of a crypto-related scam, you are encouraged to submit a complaint with the DFPI or contact us at (866) 275-2677.