By Craig Erwin, Ph.D.
Many nasty things have come from Covid-19, but one of the most destructive has to be crypto/romance scams. Although they might not kill you, as Covid could, these scams could leave you penniless and devastated. The social isolation that Covid launched set the stage for crypto/romance scams and women and millennials are most susceptible to them.
The crypto/romance scam starts when you meet someone online. He’s charming and seems to know a great deal about cryptocurrencies. Before you know it, you are falling in love with him. He convinces you that he has gotten rich by investing in cryptocurrencies and he assures you that he can help you do the same.
What could possibly go wrong? He has earned your trust, even though you have never met him face to face. He convinces you to invest your life savings in cryptocurrencies and, after you have done that, to borrow as much money as you can so you are able to invest even more. Eventually he disappears without a trace (with your life savings) and is no longer able to be reached. Unfortunately, you have learned some terribly expensive and painful lessons.
What makes these schemes so hard to resist? Two very powerful drugs, the promise of love and the promise of riches. And cryptocurrencies add a new and compelling twist to the traditional romance scam because we have all heard about everyday people becoming cryptocurrency millionaires overnight.
What can you do to protect yourself from scammers like these? If something (or someone) is too good to be true, it probably is. If you engage in an online romance, dig up all the online information possible about your lover to ensure that he is who he says he is. If your online searches come up empty, dump him immediately. Talk to a trusted friend about your lover to see if she finds anything suspicious about him. Never send money to anyone you meet online. Only invest with reputable stock brokerage firms, such as Charles Schwab or Fidelity Investments. Finally, learn to be skeptical. There are plenty of scammers trying to separate you from your money. Only trust reputable institutions that you’ve checked out thoroughly and people who’ve earned your trust over years.
Have you been tempted by an online Romeo? If so, how did it go? Have you let someone you met online help guide you to invest money? If so, how did that work out?
For more information on investment scams, investing, and cryptocurrencies, click on the following links: