This case involves a series of material payments made over a two-month period during 2024, for investment in crypto-assets.
The victim, Catherine, was persuaded to invest funds in cryptocurrency on a third-party online trading platform after seeing an advert on the internet that promised high returns.
After expressing interest in investing, the fraudsters contacted Catherine and instructed her to send payments to a virtual IBAN (vIBAN) account. The said vIBAN to which the Catherine’s funds were sent was a client payment account held by a cryptocurrency exchange with a licensed payment services provider.
From the point of view of Catherine’s bank/ payment provider, the payment transfers appeared to be normal me-to-me payments, where the funds were to be credited to an account Catherine appeared to have with the receiving institution. In reality, Catherine held no account with the licensed payment services provider, and the transfers were to a client payment account of the cryptocurrency exchange, the latter being the corporate client of the licensed payment services provider.
The fraudsters had assisted in opening a cryptocurrency wallet in Catherine’s name with the cryptocurrency exchange after Catherine gave them her personal details, including a copy of her ID card.
Transfers were allegedly made from Catherine’s account with the cryptocurrency exchange to an online trading platform or other wallets, which later turned out to be fraudulent.
To convince Catherine about the legitimacy of the activities, the fraudsters gave the victim instructions on what crypto-assets to buy, and even showed her a fictitious trading account that was doing well and making profits.
When Catherine sought to withdraw her money and the purported profits, she discovered she had been scammed. By then, Catherine had lost €72,000.
Warning signs and red flags:
- Communications and contact initiated from the internet.
- Promises of easy, high returns.
- Discussions about investments held with a person not licensed by a regulatory authority.
- Investment advice given by a party whom the consumer has never met physically.
- Veracity and authenticity of the overseas-based investment platform not confirmed.
- Indication of substantial gains over a short period of time.
- Lack of clarity and no verification of the owner of the payment account and/or external wallets to which assets are to be transferred.
Disclaimer: This account is based on a real-life case investigated by the authorities. While the events and figures described are factual, names have been changed to protect the privacy of the individuals involved.