Cryptocurrency Scams Cost Marylanders $94 Million in 2023, FBI Report Shows

In a newly released FBI report, Marylanders have been revealed to be among the thousands of Americans impacted by cryptocurrency scams in 2023. The FBI report, which details the extent of cryptocurrency fraud across the country, highlights that Marylanders alone lost nearly $94 million to various scams. These losses were primarily the result of fraudulent investment schemes, with romance scams and social media manipulation being significant contributors.

Cryptocurrency scams have become a growing problem nationwide, and the report shines a light on the fact that Maryland was the 13th worst-affected state by these schemes last year. Victims in Maryland were lured through emotional manipulation, leading them to make large investments in fraudulent crypto operations. The scams often exploited people’s trust, especially through online relationships, making these individuals vulnerable to significant financial loss.

The PDF can be found here

How the Scam Works

The FBI report emphasizes that cryptocurrency scams frequently involve emotional manipulation and trust-building tactics. Romance scams have become increasingly common in these fraudulent operations. Criminals approach their victims on dating platforms or social media sites, slowly building relationships and creating emotional bonds. Once they establish trust, the scammers begin to present investment opportunities, often tied to cryptocurrency markets. Victims are often promised quick, significant returns, or are convinced that they are helping someone they care about.

As noted by Sadé Lemons, public relations and social media manager for the Better Business Bureau of Greater Maryland, scammers frequently steal both money and personal data by convincing victims to share their personal and financial information. Once this data is in the scammers’ hands, it becomes much easier for them to execute financial fraud, leaving victims vulnerable to both financial loss and identity theft.

Victims shared stories of scammers posing as professionals—such as engineers or oil project workers—building elaborate cover stories to present themselves as trustworthy. Once the emotional bond is secured, scammers begin their solicitation for investments, using fake crypto platforms and wallets to lure victims into handing over significant sums of money.

• Defendant:
  The FBI report does not single out individual defendants, as the scams discussed involve a wide range of actors targeting victims throughout Maryland and beyond.
• Crime:
  The primary crimes include fraudulent cryptocurrency investment schemes that often involved emotional manipulation. These scams were typically executed through romance scams, social media, and online interactions, where criminals exploited their victims’ trust.
• Amount Defrauded:
  Nearly $94 million was stolen from Maryland residents through cryptocurrency scams in 2023 alone.
• Method:
  The scammers often targeted their victims using romance scams, where they built trust over time through online communication on dating apps or social media. Once trust was established, they convinced their targets to invest in fake or fraudulent cryptocurrency schemes. A key element in these scams was emotional manipulation, promising victims quick returns or secure investments.
• Investigating Agencies:
  The FBI and Better Business Bureau (BBB) of Greater Maryland are involved in investigating these cases and spreading awareness to prevent further incidents. They emphasize the role of emotional manipulation and how scammers exploit personal data and online trust.
• Victim Stories:
  One example involves a victim who was contacted by someone claiming to be an engineer working abroad. After establishing trust over the course of three weeks, the scammer convinced the victim to send money by presenting a seemingly legitimate investment opportunity. The victim reported sending money to what was presented as a cryptocurrency investment, only to find out later that it was a scam.

Cryptocurrency Scams in Maryland

The 2023 FBI Cryptocurrency Fraud Report sheds light on how these scams have impacted Maryland in particular. According to the report, Maryland was the 13th worst-hit state for crypto-related fraud, with nearly 1,400 complaints filed last year. Of the total 58,000 complaints related to these scams across the country, Maryland accounted for a significant portion of both the total cases and financial losses. Investment scams were identified as the most common type of scam, with romance scams running a close second.

Marylanders were primarily targeted through romance scams, where victims were led to believe they were in a trusting relationship with the scammer before being convinced to invest in fraudulent schemes. While only about 10% of total financial fraud complaints in 2023 involved cryptocurrency, 50% of the money lost came from these scams. This suggests that while crypto-related scams may be less common, they are far more financially devastating to victims.

According to the 2023 FBI Cryptocurrency Fraud Report, Marylanders experienced significant financial losses due to crypto scams. The report highlights that these scams are part of a broader nationwide trend. It took place over the course of 2023, with nearly 1,400 complaints filed in Maryland alone. These scams evolved primarily through romance-related schemes where scammers built trust with their victims over time, and eventually convinced them to invest.

In 2023, Marylanders lost nearly $94 million to cryptocurrency scams, according to an FBI report. The scams primarily targeted individuals through romance and social media manipulation, convincing victims to invest in fraudulent crypto schemes. Nearly 1,400 complaints were filed in Maryland, making it the 13th worst-affected state in the U.S. The FBI and Better Business Bureau (BBB) are urging the public to remain vigilant, especially when approached online by individuals or entities promising high returns. Victims shared stories of trust being built through fake personas, leading to large financial losses. The report highlights the importance of careful online interactions, especially when investment opportunities are presented. The FBI and BBB provide channels for reporting suspected crypto fraud.

Using a hardware wallet can be a strong line of defense against cryptocurrency scams. By storing your crypto offline, you make it harder for scammers to access your funds, even if they convince you to invest.

1. Ledger Nano X:
The Ledger Nano X offers secure offline storage and supports a wide range of cryptocurrencies. Its Bluetooth feature allows users to connect their mobile devices securely, ensuring that they can manage their assets safely without exposing them to online threats.

2. Trezor Model T:
This wallet provides excellent security features such as a touchscreen interface and two-factor authentication. Trezor’s strong encryption makes it more difficult for scammers to access your funds, even if they manage to gain partial access to your personal data.

3. Coldcard Wallet:
Known for its extra layer of security, Coldcard operates entirely offline, making it immune to internet-based scams and hacks. This wallet is particularly useful for large crypto holdings and long-term storage, protecting your assets from potential fraudsters.

Additional Preventative Steps:

• Always double-check online identities before engaging in financial transactions, especially through social media or dating platforms.
• Be cautious of anyone promising unusually high returns on crypto investments. If it sounds too good to be true, it probably is.
• Report suspicious activity immediately to the FBI or Better Business Bureau (BBB).