Harpreet Sahota, a short haul truck driver living in Vaudreuil-Dorion, Que., Found himself exhausted this summer, sometimes working six days a week and still not having much to gain from.
Then she was laid off for a few weeks and decided she needed a new source of income – to find a way to work less, yet still have enough to live comfortably.
It was then that a tempting ad appeared on Facebook, offering him an investment opportunity. Sahota clicked and entered his contact details.
But one particular offer that quickly followed involving bitcoin transactions never produced a return and resulted in huge losses.
“Within five minutes I started getting calls from these different financial companies,” she said, and one called LegalTrader.com caught her attention.
The representative promised a return of up to 70% on her investment.
“I thought, why not? “
It started with around $ 300 to open an account, but that small investment quickly turned into an avalanche. Sahota says eloquent representatives quickly convinced her that she was getting big returns on her investment, telling her that she should invest more in order to earn more.
So she sent more money. Then she was told she was losing funds and needed to invest more to get back on track.
“I took $ 15,000 on my line of credit,” she said.
“And we had some gold jewelry that my mom had for my wedding, saved, and we ended up selling it and using that money, and maxed out my credit cards.”
Although LegalTrader’s website looks professional, researching the name of the company reveals many websites and forums accusing it of being an illegitimate company that scams people with their money.
But Sahota, despite knowing there were red flags, decided to go ahead anyway, convinced by company officials that she would hit the dirt.
She made direct transfers and payments with her bitcoin wallet, a cryptocurrency payment method.
“I got into debt,” she said.
Sahota spent over $ 102,000 on investments and fees. When she tried to withdraw the funds, she was told that payments would be made by bitcoin transfers, but those transfers were never made.
RCMP say crypto scams are becoming more common
Unfortunately, cryptocurrency scams are becoming more and more common. This type of fraud in particular increased by 400% in Canada between 2017 and 2020.
“Fraud is big business for organized crime around the world, and criminals are always exploring new ways to take your money,” the Royal Canadian Mounted Police (RCMP) said in a recent press release.
From cryptocurrency scams to those involving fraudulent investment firms, the RCMP says there are many ways Canadians are being fooled with their money.
In some cases, explains the RCMP, “crooks are known to usurp credible financial institutions in order to deceive victims into believing they are legitimate and to transfer funds to them.”
Canadians have lost over $ 120 million in 2021 so far, up from $ 53 million in 2017. In Quebec, over $ 10 million was lost in 2017, while that number has climbed to over 15 million dollars this year, according to RCMP data.
the RCMP says there are several ways for investors to protect themselves, starting with purchasing cryptoassets through a registered trading platform.
Crypto investment scams often involve victims downloading a trading platform and transferring the crypto to their trading account. Most victims are then unable to withdraw funds. Before investing, always ask for more information and do your research. Find out more: https://t.co/caWTPxxsLg Photo. twitter.com/8Ib8wkcna1
Sahota filed a complaint with the Quebec provincial police.
Canadians can consult the National Canadian Securities Administrators Registration search to see if the entity is registered with securities regulators, the RCMP said.
People should also resist pressure tactics and be skeptical of high “guaranteed” returns, according to the RCMP.
“Scammers work hard to override your gut with complex documents and use overly complicated, inconsistent and jargon-filled explanations,” said the RCMP.
“If you can’t figure it out and can’t get your questions answered, go. “
People are hiding behind Bitcoin’s anonymity, expert says
David Khalif is the co-founder and COO of Viridi Funds, a US-based registered investment advisor specializing in cryptocurrency.
Unfortunately, when people hear all the hype around cryptocurrencies like bitcoin, they are easily drawn into what they believe is a surefire way to make money easily, he said.
But the first thing people like Sahota should consider is that they don’t need to hire a company to invest in cryptocurrency, he said. It can be done by yourself.
When someone says, “Send me money, I will invest on your behalf,” people should be concerned, because once you send money through a bitcoin transaction, there is none. see you, Khalif said.
“There’s no way to say, ‘hey customer service, give me my money back’. There’s not even a very good way to prosecute them, because in a lot of these cases these people are anonymous, ”Kahlif said.
“That’s why I always urge people to be very careful about the too good to be true emotional side of investing.”
There are also cases where these fraudulent companies will use fabricated numbers to convince people that their investments are profitable, convincing them to invest more money, Kahlif said.
He said that at the very least, people should research these companies thoroughly before investing.
Trying to get the word out, while Meta runs rampant
Sahota has tried to publicize these scams on social media. She started a Facebook group and heard several similar stories, including another Quebecer who lost thousands of people to LegalTrader.
“I decided to act and guide other people and bring everyone together so that we can act together,” she said.
And it all started by clicking on a Facebook ad.
When CBC Montreal sent a screenshot of the ad to Meta, Facebook’s parent company, a spokesperson released a statement, saying the ad violated Meta’s policy on unacceptable business practices.
In particular, Meta does not allow advertisements that “scam people for their money or their personal information.”
The statement says Meta is working to combat online scams, security breaches and fraudulent advertising.
“We have started to use proactive detection technology to help remove content that violates our policies,” the statement said.
But people continue to be part of the equation as teams review content and users are able to report anything suspicious, the release said.
“Everyone on Facebook and Instagram plays a role in the security and respect of the platform,” says Meta.
LegalTrader did not respond to multiple email requests for comment and the phone numbers listed on the site appeared to be down.
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