US investors lost $13.8m in crypto scam involving Singapore-based exchange
Five victims in the United States have lost over US$10 million (S$13.8 million) in a cryptocurrency scam that involved spoofed domains of the Singapore International Monetary Exchange (Simex).
On Monday, the US Department of Justice (DOJ) said that between May and August 2022, scammers lured the victims into participating in a cryptocurrency scam where they invested in fraudulent platforms only for their funds to be siphoned away into private wallets.
To convince the victims they were investing in a legitimate cryptocurrency opportunity, the scammers created seven fake domains of Simex, a Singapore-based exchange through which investors can trade financial contracts known as futures.
A court in the US state of Virginia has authorised the seizure of these domains, the DOJ said.
Fraudsters or hackers use these domains to create websites that appear to belong to a trusted company when they, in fact, link the user to a fake website controlled by cybercriminals.
The DOJ said the victims would first encounter the scammers on dating applications or social media websites. Sometimes, the scammers introduce themselves after sending a text message which they claim to have sent to the wrong number.
“Scammers initiate relationships and slowly gain their trust, eventually introducing the idea of making a business investment using cryptocurrency,” the DOJ added.
“Victims are then… persuaded to invest money. Once the money is sent to the fake investment app, the scammer vanishes, taking all the money with them, often resulting in significant losses for the victim.”
To conceal the source of the funds they have received, the scammers immediately transfer them through multiple private wallets.
During a Global Anti Scam Summit last week, Mr Camill Cebulla, the European sales director of Singapore-based cyber-security company Group-IB, said crypto scams had increased by 335 per cent in the first half of 2022 from the same period in 2021.
In 2021, around US$55.3 billion was lost to all scams worldwide, according to a study done by non-profit organisation Global Anti Scam Alliance (Gasa) and data service provider ScamAdviser.
The Department of Justice advised victims of such scams to lodge a report with the United States Secret Service.
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