Investor Loses $310,000 on a Crypto Exchange After Unsolicited LinkedIn Connection Request

A trader reported losing $310,000 due to a scam involving a fraudulent digital asset trading platform called Ethfinance.Based on his claims, he discovered the platform through a spontaneous LinkedIn connection.

This incident has drawn the attention of the Washington State Department of Financial Institutions (DFI) Securities Division. In response, the agency issued a consumer alert on June 13, stating the details of the event.

Crypto Investor's Loss to Scam

Specifically, the investor was drawn to Ethfinance by a random LinkedIn friend request, a common scam tactic.Trusting the platform's legitimacy, he transferred a large sum from his decentralized finance (DeFi) wallet, hoping to profit from crypto trading.

When he tried to withdraw some funds, he was told more money was needed to finalize a smart contract" for the withdrawal.Realizing something was wrong, he refused to send more money, but his account was already locked, making it impossible to access his funds.

The DFI's alert suggests this situation is a classic example of Advance Fee Fraud." This scheme typically involves a scammer promising victims significant returns or valuable services in exchange for an upfront fee.

Once the initial payment is made, scammers either disappear or continue demanding more money for fabricated reasons.Although the allegations are still unverified, the DFI noted that this case fits the typical pattern of such fraud.

Importantly, the alert urged investors to thoroughly research and be cautious with unsolicited investment offers, especially those from social media platforms like LinkedIn.

Other Fraudulent Cases Revealed

The Washington DFI has identified Ethfinance in a past complaint. According to the incident, a California resident reported losing over $165,000.

The fraud occurred after an online encounter with an unknown individual who promised to reveal the necessary steps to make money in options crypto trading.

The scam became evident after the investor received a request for 25% of the profits as taxes to execute a withdrawal. This request came from the supposed CEO of Crypto Customer Service on Telegram.

In addition to these incidents, the DFI released three more alerts on June 13. One of them was a fraudulent investment management platform. In this case, the agency received a complaint about PrimeMarketTrading.com, which claims to be an international digital investment management platform.

An investor who discovered the site through a Facebook Women's Group" initially invested $500 with a 0 loss" guarantee.

Later, they were told to invest an additional $3,135 to avoid their account being deactivated and losing all their money. The $500 investment supposedly generated a $7,425 profit.

The platform claims to be featured by Forbes and CNBC and offers services in financial management and investments in forex, digital assets, real estate, and stocks.

Also, their investment plans range from 72 hours to 30 days, with required deposits between $200 and $100,000. The other two alerts were about other allegedly fraudulent crypto exchanges.

Importantly, these reports showcase the growing trend of deceptive practices in the crypto sector. They further emphasize the need for investors to remain cautious and thoroughly conduct due diligence before investment.

The post Investor Loses $310,000 on a Crypto Exchange After Unsolicited LinkedIn Connection Request appeared first on The Tech Report.