Australian cryptocurrency traders are being warned to remain on their guard against potential crypto scammers after a new report revealed that an almost 200% rise in the number of reported cases of fraud had occurred.
A report from the Australian Competition and Consumer Commission revealed that crypto scams went up by a huge 190% or so over the course of 2018.
In total, it is believed that $6.1 million Australian dollars found their way to crypto fraudsters during the year. This figure is equivalent to almost $4.3 million US dollars, or nearly £3.3 million British pounds.
It represents a significant rise on the figures covering the year before too. In 2017, there was a loss of just $2.1 million Australian dollars.
In total, that represents a rise of $4 million Australian dollars in just one year. The figures are even more striking given that on the whole, there were significant decreases in the values of major cryptocurrencies over the course of the year.
In number terms, there were 674 cases of fraud in which cryptocurrency was sent to a fraudster reported to the authorities in Australia in 2018.
A fully accurate figure may never be known, as some people who are affected by the problem choose not to come forward.
An interesting demographic dynamic was also revealed in the report. It found that more than half of the victims of crypto fraud were men in the 25 to 34 years old age bracket.
The report came as part of the “Targeting scams” series, which is released periodically and covers a variety of scams.
In a foreword, the report’s authors argued that the rise in crypto fraud may have had something to do with the fact that it is arguably easier to circumvent standard security checks.
“To avoid the fraud and scam detection systems employed by banks, scammers are now increasingly
asking for payment via unusual payment methods such as gift cards and cryptocurrencies”, they wrote.
On a more optimistic note, they also pointed out the many steps being taken to combat the problem.
“To combat these increasingly sophisticated scams and the growing volume of contact with potential
victims, the ACCC and other government and private organisations came together to raise awareness
and find intelligent solutions. In 2018, the ACCC engaged with a range of private sector ‘intermediaries’
whose businesses are commonly used in the course of scams”, they wrote.
“These included Australia’s four major banks (ANZ, Commonwealth, NAB and Westpac), money remitters and online classified sites.
“The ACCC sent thousands of scam reports (where reporters gave their permission) to these intermediaries,
resulting in improved scam detection, the blocking of scam transactions, the recovery of funds for
victims, training for frontline bank staff and the blacklisting of scammer bank accounts”, they added.
Despite the clear rise in the prevalence or, at least, reported prevalence, of cryptocurrencies fraud, however, there is evidence to suggest that crypto fraud still remains relatively small compared to fraud of non-crypto financial assets in Australia.
It was also revealed that combined financial losses in the country sat at $489.7 million Australian dollars – suggesting that the rise in crypto fraud does not even come close to the amount lost elsewhere.