Bitcoin recovery scams, as well as those involving other cryptocurrencies, are a hot-button issue right now. Recovery scammers pretend to help people recoup their Bitcoin or other cryptocurrency losses from initial investment scams. However, they simply double scam victims’ pain by defrauding them for a second time under the guise of asset recovery.
In a recent blog, Cybertrace alerted the public to one such unscrupulous operator: eFunds Recovery. As part of our investigation, we have also come across other similar suspicious asset recovery operators, such as BrokerComplaintAlert. Apart from not being registered, regulated or accredited anywhere, what has become apparent is how these operators systematically use fake news and fake reviews to push their bitcoin recovery scams. Let’s look at these tactics in some more depth.
Fake News: A Serious Global Challenge
Even outside of bitcoin recovery scams, fake news has become a household phrase over the past five years. In fact, the Macquarie Dictionary recently chose it as its Word of the Decade! A 2019 study in the U.S. showed that Americans saw fake news as a bigger problem than racism, sexism or terrorism. Fake news denotes ‘false stories that appear to be news’ by imitating the look, genre and characteristics of genuine news articles.
While some are the work of satirists providing social commentary, most are based on nefarious political, commercial or criminal purposes. In politics, fake news is leading to increasing polarisation, whereby different groups of people no longer inhabit the same factual reality. Needless to say, this is highly dangerous to the health of our democracy!
In the world of business, fake news can elevate or destroy companies’ reputations without a basis in fact. Of course, scammers have learned to also take advantage of this. By writing fake news articles that purport to come from independent sources, they seek to lend legitimacy to their scams.
Fake Reviews: A Persistent Industry Problem
While fake news requires a platform such as an online publication or website, fake reviews are even easier to produce. All scammers need is a free account on whatever platform is hosting the reviews! Since Amazon pioneered them in 1995, customer reviews have become an essential part of the reputation economy. Customers trust independent reviews by people like them, particularly when it comes to online transactions. But what is to stop someone from posting a fake review? As it turns out, not a lot! “For some product categories, thirty percent of all online reviews are fakes”!
As a result, many review-dependent businesses are having to expend huge efforts and sums to root out fake reviews. Some, like Yelp, develop algorithms that filter out one in six of their reviews, according to the Harvard Business Review. Others, such as Amazon, spend half a billion dollars per year and employ more than 8,000 people to combat fraud. Even so, they don’t catch all fake reviews or remove them quickly enough.
Apart from these behemoths, many smaller sites likely do not have the resources to moderate, identify and remove fake reviews. This creates a dilemma for customers who rely on reviews but can’t be sure whom to trust. Let’s look at how this plays out when it comes to Bitcoin recovery scams (or those involving other cryptocurrencies).
What are Bitcoin Recovery Scams?
Bitcoin (or other crypto) recovery scams are a type of secondary scam. In secondary scams, fraudsters target the victim of an initial rip-off again in a follow-up scam, thus compounding the damage. The initial scam is often related to fraudulent cryptocurrency trading or investment opportunities. Here, victims believe they are investing their money with a reputable cryptocurrency broker who is delivering unbelievable returns for them. When the victims then try to access their funds, the scammers either string them along or cut off communication altogether. It’s only now that the victims realise that they have been scammed!
Faced with the loss of tens or even hundreds of thousands of dollars, victims are desperate for help. It is precisely this desperation that secondary scammers then seek to exploit with promises of guaranteed recovery of cryptocurrency funds.
Now, the scammers could be the same people targeting the same victims for a second time. After fleecing them of their hard-earned money once, they simply assume another identity and contact them again. Brazenly posing as their rescuers, the secondary scammers then defraud them of even more money. Alternatively, the original scammers may on-sell the victims’ details to other scammers who consider them easy targets because they have been duped before.
The Role of Fake News and Fake Reviews
Suppose you have been the victim of a cryptocurrency trading scam and have lost a lot of money. It would be reasonable for you to look around to see who could help you to get your money back. You have been burned before and are suspicious, but you also really want to recover your funds. This is where fake news and fake reviews can be so pernicious. Scammers design them to look, sound, and feel authentic and independent, providing assurance that you are making the right choice. But they are fake and simply part of another scam preying on your desperation!
Fake News Set the Scene
Take these recent articles in BusinessMatters, the self-styled UK’s Leading Business Magazine: here, here and here. At first glance, they look like independent news articles from a seemingly reputable source and have further positive comments underneath.
However, a closer analysis shows several red flags: firstly, none of the articles have an author attribution or by-line, a standard journalistic practice. Secondly, the articles contain repetitive phrases/key words, which appear nonsensical but actually work to enhance their search engine rankings. Thirdly, the article is written in a promotional, completely uncritical tone more appropriate for a company’s advertisements than a newspaper article. Finally, using words like “guaranteed” or “easy” to describe Bitcoin recovery processes is a clear red flag. Asset recovery is a complex process and success cannot be easily guaranteed.
Fake Reviews Seal The Deal
In the comments/review section of the article, we can see how fake reviews then work to hype the bitcoin recovery scam artist even further. The reviewers provide acclaim and express their confidence but are likely all fake/different aliases of the scammers. This is apparent through the fact that most have only made one comment, have no followers and aren’t following anyone. Others try to introduce their own Bitcoin recovery scams by sharing stories of unbelievable success and unsolicited contact details.
So, Whom Can You Trust?
There are some general rules to follow when it comes to avoiding fake news. For one, don’t get all your information from social media. Instead, check reputable news websites with strong editorial standards and professionally trained journalists who fact-check stories and include multiple perspectives. Secondly, check who wrote the article and what their qualifications and experience are. Finally, make sure you cross-reference your information by accessing a variety of sources and, most importantly, read with a critical mindset. Who is saying this, what are they saying, what is their motivation?
When it comes to avoiding fake reviews, this can be a bit trickier, but there are still some steps you can take. If visiting review sites such as Trustpilot, don’t just rely on overall rating scores but dive a bit deeper and look for patterns in the reviews (too short, too long, repetitive, stilted, etc.). Next, check the dates they were posted on to see if a lot of them happened in a short period of time. This could indicate a fake review ‘push’. Finally, you should also keep an eye out for reviewers’ histories of postings as well as polarised patterns of ratings.
Finally, when it comes to actually helping victims of cryptocurrency fraud, you can take the guesswork out of it and trust qualified and verified experts like Cybertrace. Our website clearly shows where we are registered, regulated and accredited. You can also independently verify these details via government records and databases, thus providing you with security and peace of mind. Contact us today for a confidential assessment with one of our expert analysts to see how we can help.