Investor claims to have lost $310,000 to cryptocurrency trading platform

An investor claims he lost $310,000 to a purported cryptocurrency trading platform after learning about it through an unsolicited LinkedIn connection request.

A consumer alert issued by the Washington State Department of Financial Institutions (DFI) Securities Division on June 13 stated that the investor was using a purported cryptocurrency trading platform called “Ethfinance.”

“The investor discovered Ethfinance through a random friend request on LinkedIn,” DFI said. She added that the investor transferred a total of $310,000 from his “DeFi wallet” to the platform in hopes of making profits from cryptocurrency trading.

The fraudulent exchange’s EthFinance website is currently still available online. Source: Eth-Finance

When attempting to withdraw some of their initial capital and reporting their profits, the investor was informed that they needed to add more funds in order to complete the “smart contract” and then withdraw the funds.

“The investor did not send any additional money. The institution said the investor was unable to withdraw money from his account and his account was closed.

The regulator said the case appeared to be “advance fee fraud”, although it said it had not verified the allegations.

Advance fee fraud is a type of scam that promises victims large sums of money, products or services in exchange for a small upfront payment.

Once paid, the scammer tricks the victim into sending them more charges for other things – or simply disappears.

about: The Federal Trade Commission (FTC) is issuing an urgent warning about the rise of cryptocurrency romance scams.

DFI’s Washington-based cryptocurrency scam tracker shows the platform was also mentioned in a previous complaint, in which a California resident said he lost more than $165,000 after meeting a stranger online who offered to teach him how to make money trading cryptocurrency options.

Washington DFI Cryptocurrency Scam Tracking Results for ETH Finance. Source: Washington IFD

The investor realized it was a scam when the “cryptocurrency customer service CEO” on Telegram asked him to send 25% of profits as “taxes” in order to finalize the withdrawal.

DFI in Washington also issued three other alerts on June 13. Two of them were linked to fraudulent cryptocurrency exchanges, and the other was linked to a fraudulent investment management platform.

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