Cryptocurrency Fraud

Crypto transfers are fast, cross-border and hard to reverse, which suits fraudsters. Common forms include the fake initial coin offering, where investors buy a token that has no real project behind it, and the cloud mining scam, which sells shares of mining capacity that does not exist. In a giveaway scam, a fake account using a celebrity's name promises to double any coins sent to it. Newer versions use AI-generated videos, cloned voices and trading bots that claim impossible returns. Hacks of exchanges and attacks that drain wallets are often counted too. Victims usually pay by sending coins to an address that cannot be recalled. Investigators trace the funds across blockchains and exchanges. For a bank, the practical task is spotting customers who repeatedly send money to exchanges or wallets linked to known scams, before the savings are gone.

A social media advert, using a deepfake video of a well-known businessperson, promises that anyone who sends 1 coin to a given wallet will receive 2 back. Hundreds of people send funds within hours. The wallet then moves the coins through several exchanges and mixing services. A bank's compliance team later sees repeated transfers from customers to the same exchange address and files suspicious activity reports.