The Department of Financial Protection & Innovation (DFPI) in California has launched a crypto scam tracking tool for investors and traders to spot potential threats in the crypto ecosystem. The authority has been receiving several complaints from consumers and investors regarding crypto scams happening each year.
The regulator launched this tracker on February 16, 2023, with the department compiling list of crypto complaints and understanding all forms of scams and other crypto grievances faced by victims. The list represented the description of losses incurred due to fraudulent crypto activities.
Furthermore, the department also stated that through their new crypto scam tracking tool which is a combination of rigorous enforcement efforts the DFBI commits to shining a light on the ruthless predators in the crypto ecosystem. As a result, aiming to protect both consumers and investors from fraudulent activities.
DFPI also confirmed that most of these complaints indicated that crypto scams largely happen over social media. Thus, can be termed a social engineering scam where users are been duped into taking action via Facebook, Tiktok, Whatsapp, Instagram, and other social media like dating apps. Alongside, it was found that 4/5th of these scams were referred to as “pig – butchering scams”.
These scams refer essentially to the social engineering attempts by scammers through which they try to establish a relationship of trust with the victim. Going forward, the DFPI spokesperson stated that scam alerts received through the tracker can help users avoid similar scams. Alongside, Imposter websites are the other most commonly reported scams. Here the fake companies or websites are created in a name similar to the popular brand or others.
The tracker launched by DFPI facilitates a search function that allows users to look for potential fraudulent websites or crypto projects well in advance.