Crypto Fraud: Nothing Is What It Seems, and Often More Complex Than People Realise
Date: | Week 10 | Reading time: 8 minutes | Updated: Author: Simcha Schrijver
In short
To recognise a crypto scam you rarely rely on one sign, but often on a pattern: unexpected contact, attractive returns, pressure to invest quickly and problems as soon as you want to withdraw. Those signs can point to a scam, but do not prove it. You only get certainty when someone independently looks at the platform and the route of your money.
Paucitas is an independent expert firm in the Netherlands that investigates investment fraud and crypto fraud, in hundreds of cases a year. Sometimes a platform turns out to be fine, sometimes the investigation confirms the doubt. Either way, you know where you stand afterwards.
Get in touch with Paucitas or ring +31 20 244 5774, 24/7. A free intake is without obligation, even if you only have doubts.
In a nutshell
It is not the technology that gives a crypto scam away, but the pattern: trust, a promise, pressure and then a hurdle when you withdraw. Sound familiar? Then it is best not to invest any more and to let Paucitas take a look.
"It doesn't feel right, but I'm not sure it's a scam." Many people ring us with exactly that doubt. That is the right moment.
This blog gives the overview: what a crypto scam is, which types exist and which signs keep coming back. In doubt about a specific platform? Read also how to check a crypto investment.
What is a crypto scam?
In a crypto scam you are persuaded with a made-up story to transfer money or crypto, or to give access to your wallet. That is fraud, a criminal offence. Crypto makes it attractive for scammers: payments are fast, cross borders and cannot be reversed like a bank transfer.
The scam rarely happens in one go. Usually trust is built up over weeks or months. Scammers pose as an acquaintance, a coach, a business partner or a romantic partner, and play on real success stories from the crypto market.
How to recognise a crypto scam: which 6 signs keep coming back?
Do not focus on one detail, but on the whole picture. One sign proves nothing. If you recognise several, be extra careful:
- Unexpected contact, via social media, a chat app, a dating app or the phone.
- A high or "guaranteed" return that seems too good to be true.
- Pressure to decide quickly: the opportunity is only there today, or an "adviser" keeps ringing back.
- No authorisation: the firm is not on the FCA Financial Services Register, or it is on the FCA Warning List.
- Withdrawing fails, or first costs "tax", a "deposit" or "release fees".
- Requests for access: someone wants your recovery phrase, private keys or to look at your screen remotely.
Does any of this sound familiar? It does not necessarily mean you have been scammed. Let Paucitas take a look or ring +31 20 244 5774, and you will soon know more.
What types of crypto scams are there?
In practice we see many variants. The best known:
- Fake platforms: professional investment apps that are hard to tell from the real thing. See recognising a fake crypto platform.
- Pig butchering and romance scams: a friendship or relationship that ends in "investing together". See pig butchering explained.
- Social media groups with "signals" and thousands of members, often mostly fake accounts. See crypto scams via social media.
- Boiler rooms: call centres that use sales techniques to push you to invest more and more. See recognising boiler room fraud.
- Deepfake adverts in which well-known people appear to promote a platform. See deepfake crypto scams.
- Phishing: a fake email or website that steals your log-in details or recovery phrase. See crypto lost to phishing or a hack.
- Recovery fraud: after the first loss someone promises to get your money back, for a fee. See scammed twice with crypto.
What is the difference between a crypto scam and investment fraud?
Investment fraud is about an investment that does not exist or is not what was promised. A crypto scam is broader: phishing or a fake romance that asks for money also counts, without any investment. In practice they often overlap, because much investment fraud now runs through crypto. Read more in recognising a crypto investment scam.
An example from practice
A business owner saw an advert featuring a well-known presenter. He left his number and was rung by a friendly "account manager". His balance on the platform rose quickly. When he wanted to withdraw, he first had to pay a "deposit".
He had doubts and rang Paucitas. We looked at the platform and the route of his deposits. The picture was clear enough not to pay any more. With our report he reported it to the police and spoke to his bank.
Paucitas takes privacy very seriously and never shares clients' personal details. This is a composite example: names, amounts and details have been changed. The situation is one we see in practice.
Why do sensible people fall for it?
Victims are rarely naive. They are misled in a process that often lasts months, with patience, psychological pressure and well-prepared scripts. The networks behind this fraud are organised, with fixed roles and fake company details. Europol describes how these investment scams are set up.
Shame holds many people back. Yet it helps to talk about it early: there are often more traces then. Talking helps, and you are certainly not the only one.
Is it always a scam if you cannot withdraw?
No. Sometimes a platform holds crypto because it first wants to complete a customer check, or it asks where your money came from. That is part of legitimate rules such as KYC and AML. A genuine firm then asks for documents, not an extra payment. Sometimes access to your own wallet is the problem, and Paucitas can help you get back into it.
That is why an independent view is so valuable. Sometimes the outcome is a relief, sometimes it is difficult. But it is always better than guessing.
In doubt? This is how Paucitas looks into it
Paucitas looks at where your money really went and whether the platform adds up. Paucitas does more than trace transactions: we also go through all conversations, documents, emails and other communication, so that a complete picture emerges, with a timeline and where all the money went, step by step. Paucitas does all tracing itself, without tracing tools, and records the findings in a report that anyone can follow and understand step by step.
- Costs: every investigation is tailored. You receive a bespoke quote in advance, which we go through together, so there are no surprises.
- Turnaround: from the same day to around two weeks.
- Contact: you can ring at any time, 24/7. We answer the form within 1 to 3 hours, and email within 24 hours, usually the same day.
The report shows whether money is still available, or where it went, and what the next steps are. If it is a scam, reporting it to Report Fraud (or Police Scotland if you live in Scotland) is one of those steps, and the Paucitas report is then a strong attachment that sets everything out fully and clearly. In doubt about a platform, or unable to withdraw? Get in touch or ring +31 20 244 5774.
Sources: FCA, Financial Services Register; FCA, warning list; Report Fraud; Police Scotland, scams and frauds; Europol, investment scams.
Do you have questions about this blog?
Feel free to get in touch with Paucitas. Paucitas can be reached by phone 24/7, including evenings and weekends. Through the contact form we usually reply within 1 to 3 hours, and we answer e-mail within 24 hours.
Contact form
Usually a reply within 1 to 3 hours
"*" indicates required fields
We only use your details to contact you about your request. You can read more about this in our privacy statement.
Frequently asked questions about recognising a crypto scam
What are the main signs of a crypto scam?
Paucitas mainly sees these signs: unexpected contact, a promise of high or guaranteed returns, pressure to decide quickly, a firm without authorisation and extra costs as soon as you want to withdraw. If several signs come together, it is best not to invest any more and to have it checked.
How do I check whether a crypto firm is authorised?
Paucitas advises: look the firm up on the FCA Financial Services Register and the FCA Warning List. Make sure the name, website and address match exactly. Scammers often use names that resemble genuine firms.
Which types of crypto scams are most common?
Paucitas mainly sees fake platforms, romance scams and pig butchering, social media groups, boiler rooms, deepfake adverts, phishing and recovery fraud. The form differs, but the pattern is often similar.
Can you get crypto back after a scam?
Paucitas: that depends on your situation. If you still have access to your own wallet or account holding funds, there may still be options. If everything has been sent to the fraudsters, the picture is different. That cannot be judged from a distance. Paucitas first looks at your situation and tells you honestly what is and is not possible. Be careful with anyone who promises in advance that your money will come back. In doubt? Contact Paucitas and you will know where you stand.
Is it a scam if a platform holds on to my crypto?
Paucitas finds that this is not always the case. A legitimate platform can temporarily block withdrawals for a customer check and then asks for documents. If the platform first asks for an extra payment, that is a strong reason to have it looked at first.
From Amsterdam, for the whole of the UK
Everything can be done fully online. Prefer to meet in person? You are very welcome at our office in Amsterdam, by appointment.
Paucitas is an independent expert firm based in the Netherlands that, for clients across the UK, investigates investment fraud and crypto fraud, establishes the origin and legitimacy of crypto assets and prepares expert reports for legal proceedings and compliance.
Your own situation
If you are reading this, you probably have a question about your own situation. That is exactly what Paucitas does.
The first step is contact by phone. You can book that call by phone or through the contact form, so you do not have to wait. In the call we look together at what can factually be established in your case and what Paucitas can examine for you.