FBI Crypto Hacker Fake App Defraud Investors Advisory Warning US Security Recommendations

In a public warning issued on Monday, the Federal Bureau of Investigation (FBI) said fraudulent cryptocurrency apps defrauded investors in the United States of $42.7 million between October 2021 and May 2022. The agency said he observed “cybercriminals contacting US investors, fraudulently claiming to offer legitimate cryptocurrency investment services and convincing investors to download fraudulent mobile apps, which cybercriminals have used with increasing success over time to defraud investors of their cryptocurrency.A total of 244 victims have been identified by the FBI.

The FBI said in its advisory that bad actors are taking advantage of the growing interest in mobile banking and crypto investments. Cybercriminals are said to trick investors by using official names, logos and other identifying factors of legitimate companies, including fake websites. Once they gained the trust of investors, they asked them to download an app and deposit cryptocurrencies into their wallets. When investors tried to withdraw funds from the app, users received emails stating that they had to pay taxes on their investments in order to withdraw amounts.

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When unsuspecting users would pay the supposed fee, their funds would still remain inaccessible. The FBI added that it “also damages the reputation of American investment firms.”

What does the FBI recommend?

The FBI has advised financial institutions to proactively warn their customers and inform them of steps they can take to report such cases. The agency also recommends institutions notify customers if they have a mobile app and periodically search online for their respective company logo or other information to spot unauthorized activity.

For customers, the FBI recommends that users try to verify the legitimacy of an app before downloading it and beware of unsolicited requests to download such apps. “Treat apps with limited and/or broken functionality with skepticism,” the FBI said in its advisory.

Disclaimer: Crypto products and NFTs are unregulated and can be very risky. There may be no regulatory recourse for any loss arising from such transactions. Cryptocurrency is not legal tender and is subject to market risk. Readers are advised to seek expert advice and carefully read the offering document(s) and related material material on the subject matter before making any type of investment. Cryptocurrency market forecasts are speculative and any investment made will be at the sole cost and risk of the readers.

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