Indians have around Rs 1,000 crores in Crypto Scams: Report

CloudSEK, a cybersecurity firm, suggests that Indian victims have lost up to Rs 1,000 crores in several cryptocurrency scams so far. CloudSEK chief operating officer (CEO) Rahul Sasi in a statement said, “As investors shift their focus to the lucrative cryptocurrency markets, scammers and cheats turn their attention to them as well. We estimate that threat actors have defrauded victims of up to Rs 10 billion via such crypto scams.”

CloudSEK claimed it noticed dozens of new phishing Websites and Android apps with the term 'CoinEgg' that were intended to mislead users as part of its continuing campaign against fraudulent cryptocurrency exchanges. The cybersecurity firm also said in a statement, “This large-scale campaign entices unwary individuals into a huge gambling scam. Many of these bogus websites impersonate CoinEgg, a legitimate UK-based cryptocurrency trading platform.”

The platform launched its investigation after being approached by a victim who had lost Rs 50 lakh in one such scam. According to the company, the fraudulent crypto exchanges worked in stages to trick victims. These fraudulent exchanges appear to have registered fake domains mimicking actual trading platforms. These sites, according to CloudSEK, imitated the dashboard and user experience to attract victims.

The fraudsters also developed fake social media profiles using female aliases to convince victims to invest in cryptocurrencies. Following that, these so-called handles would divide a $100 credit with the victim of the duplicate cryptocurrency exchange. The victim would first benefit from larger credit returns, after which the scammer would entice them to invest more money, promising higher profits. The scammers would freeze the account and disappear with the money when the victim transferred their own money to the wallet.

Following the investigation, other victims were also scammed. CloudSEK observed that the same or a different group of scammers would approach the victims, promising their assistance in reclaiming the frozen assets. These fraudsters would then obtain other personal information, such as bank account information and email addresses, in order to commit other crimes. The Singapore-based company's investigation also uncovered that if a fake domain was taken down, the threat gang would continue communicating with unsuspecting victims, diverting them to alternate domains to access the fraudulent cryptocurrency exchange.

Sasi requested authorities to identify cryptocurrency-related phishing sites. He also urged government officials, cryptocurrency exchanges, and internet service providers (ISPs) to raise awareness and apprehend such cybercriminals. According to a report, investors globally lost over Rs 72,000 crores in 12 crypto scams targeting Indians or founders of Indian origin. These scams, ranging from the notorious Bitconnect to GainBitcoin, have shattered investor confidence, with many demanding tighter legislation to prevent such incidents.