Despite vigorous efforts to introduce new solutions in the crypto space to tackle the menace of crypto scams, the number of people duped by fraudulent actors continues to remain alarmingly high.
A report published by Chainalysis on crypto crime reveals that the total cryptocurrency value received by illicit addresses increased from $4.6 billion to $24.2 billion between 2018 and 2023. The volume peaked in 2022, soaring from $23.2 billion in 2021 to $39.6 billion in 2022 before declining to $24.2 billion in 2023. Despite this decrease, the figure was still six times higher than that of 2018.
As the dynamics of the space changed, so did the type of criminal activities. While scams and stolen funds saw a dip, ransomware and darknet market activity witnessed a surge. According to the report, a vast majority of these criminal activities were driven by sanctioned entities.
Notably, among all demographic segments, the elderly are the most vulnerable due to their lesser familiarity with digital technologies.
Crypto Scams Targeting the Elderly Are on the Rise
The FBI's 2023 report on frauds involving the elderly highlighted a significant increase in scams masqueraded as sophisticated crypto investment schemes. The figures presented in the report were startling.
It revealed that monetary losses caused by investment frauds increased from $3.31 billion in 2022 to $4.57 billion in 2023—a 38% increase. In 2023 alone, the FBI received over 101,000 complaints from fraud victims aged 60 and older. Together, the victims faced losses worth $3.4 billion, a notable increase from $3.1 billion in 2022.
Within these numbers, investment fraud involving cryptocurrency rose from $2.57 billion in 2022 to $3.96 billion in 2023, an increase of 53%.
The Role of Social Media in Targeting the Elderly
Several reports stress the rampant use of social media among scammers in targeting seniors. Fraudulent actors often use social platforms to establish initial contact, where seniors may inadvertently share their personal details.
Such information aids fraudulent actors in conducting prior research and establishing a sense of personal bonding with their targets. Moreover, by befriending one elderly individual, these fraudsters also gain access to their friends, who are more likely to belong to the same age group.
After forging a personal connection, the scammers begin luring the elderly by citing attractive investment opportunities. They present manipulated examples showing abnormally high returns that take only a few transactions and typically involve rather smaller amounts. Once trust is established, the scammers coax their targets to dole out larger amounts.
Recovering from Cryptocurrency Scams
Amidst all these challenges, the silver lining is that sophisticated solutions like Lionsgate Network have been actively helping the victims. They provide timely and effective solutions to entities of all types and sizes who have lost their funds to crypto crimes.
Based in Israel, Lionsgate Network has successfully tapped into the country's cyberintelligence potential to take these fraudulent actors head-on. Crypto investigation, blockchain forensics, and asset recovery are among the key services offered by Lionsgate Network.
According to Bezalel E. Raviv, CEO of Lionsgate Network, "social media platforms like Facebook, Instagram, and LinkedIn can be hunting grounds for serious hackers who use AI to craft personalized attacks that seem genuine. The prime demographic, aged between 55 and 60, is particularly sought after globally, given their involvement in 401K plans, savings programs, and robust credit lines covered by embezzlers."
Bezalel also has some advice for the self-protection of assets. He advises always insisting on face-to-face communication, staying cautious of unsolicited messages or friend requests from strangers on social media, avoiding clicking on suspicious links or attachments, especially in emails or messages from unknown sources, keeping personal information private, and being selective about what you share online.
The elderly population is particularly vulnerable. Often not as technologically adept as millennials or Gen Z, their life savings need protecting. While services like Lionsgate Network exist with expertise in helping victims recover their stolen funds, additional efforts are necessary to educate seniors about the online threats they face.
