Cryptocurrency scams hit local residents

Two residents of Franklin County and one from Hampshire County lost thousands of dollars to scammers who instructed them to send money through cryptocurrency kiosks in order to protect their identities or other false pretenses.
Law enforcement authorities are urging residents to be wary of callers claiming an urgent need for money to be sent for any reason. The details of the scams vary, but typically involve calls from a person claiming to be a law enforcement officer identified by name and badge number, both of which are fake, or a representative of a business such as Paypal or Amazon.
In several local incidents, an individual was defrauded of $14,000 while another the victim lost $9,000 and a third victim lost $9,800 with the suspect also gaining access to a line of credit.
“Before last May, I hadn’t heard of any cryptocurrency scams involving kiosks inside convenience stores, and now I’m working with law enforcement on three separate investigations,” said First Assistant Northwestern District Attorney Steven Gagne. “Because these scammers so often target elderly residents, I urge families to talk to their elder loved ones about reaching out for help if they receive communications from anyone urgently asking for or demanding money.”
Residents are encouraged to contact their local police departments if they believe they have fallen prey to a scam of this sort.
In these schemes, victims are told their identities have been compromised, their money is in jeopardy, there are warrants out for their arrest, or they are in danger of some sort. They are instructed to withdraw money from their bank accounts and go to a cryptocurrency kiosk located in a convenience store to send the funds to resolve the issue.
The scammers sometimes engage in detailed instructions to prevent the victim from seeking help from a family member or bank official. For example, one victim was told, if asked, to tell a bank official the money was to pay cash for a discounted home improvement project. One was told to keep the information from their spouse, who, the caller implied, may have been involved in some way.
Suspects in these scams are hard to trace. Though the cryptocurrency machines used for the scams are legitimate, they can be used for nefarious purposes when a victim sends money to a specific account that is fraudulent. When used properly, the machines allow customers to insert cash, convert the cash into cryptocurrency, and then direct the newly-purchased cryptocurrency into what is called a “digital wallet.”  The kiosks resemble ATMs and have appeared with growing frequency inside convenience stores, liquor stores, and gas stations.

According to the Federal Trade Commission, scammers impersonating legitimate businesses or governmental agencies are responsible for an estimated $133 million in cryptocurrency losses since 2021. The FTC reports that the scammers sometimes claim to be investigating drug trafficking and the targets financial accounts will be frozen if they don’t send the money via cryptocurrency machine.

It is unclear if the victims will be able to get their money back because cryptocurrency payments are not reversible and are difficult to trace.

While there has been much outreach about senior citizens being victimized by such schemes, the FTC reports that people between the ages of 20 and 49 were more than three times as likely as older people to report losing money to a cryptocurrency scam, often focused on a fake investment offer.