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- Online romance and dating scams defrauded $1.3 billion from over 70,000 victims in 2022, a sharp surge from 11,000 victims in 2016, according to FTC data.
- Binance is curbing these scams, many of which rely on crypto, and is working with the FBI and the DOJ to crack down on scammers while training thousands of law enforcement personnel.
As the world becomes increasingly digital, online dating platforms and social media are increasingly becoming the preferred avenues for people to meet and strike up friendships and relationships. Unfortunately, they are also becoming a haven for scammers who prey on unsuspecting targets. With a substantial number of scammers relying on cryptocurrencies to defraud their targets, Binance has taken the lead in curbing these schemes and bringing them to justice.
The explosion in online dating is hardly a surprise as everything goes digital, from entertainment to shopping and working. According to one source, over 366 million people globally in 2022 were using dating apps to meet their significant others, 42% of whom aim is to meet a lifelong partner.
As they have always done, scammers have quickly evolved and are now using romance scams to target unsuspecting victims. The US Federal Trade Commission recently revealed that in 2022, US authorities received reports from over 70,000 victims of romance scams worth a staggering $1.3 billion, with the median reported loss at $4,400. This is a sharp increase from the 11,000 victims who reported losses in 2016.
The scammers endear themselves to their targets by feigning interest in all the same things as their victims, explains Tigran Gambaryan, Head of Financial Crime Compliance at Binance.
“It’s as though they have a direct line to your thoughts, expertly reflecting your desires back at you. The essence of their approach remains the same: exploit trust and fabricate connections to achieve their deceitful ends.,” he says.
Once the victim is hooked and “in love,” they quickly move on to defrauding them. This usually relies on fake promises of a lucrative investment opportunity or tagging at their emotional heartstrings by promising marriage or love.
Binance Stamps out Romance Scams
Digital assets have become one of the favored payment mediums in the romance scam world. With platforms like Binance and Coinbase now easily accessible globally, crypto is easier than ever to access, and once the scammers receive it, they can quickly cash out. This makes it critical for stakeholders in the crypto industry to take stern measures to crack down on the vice.
However, it’s important to note that crypto use in these scams doesn’t make crypto a crime haven. In fact, according to Chainalysis, crime in crypto has been declining steadily for years, and in its latest report, the company found crime to constitute only 0.34% of all crypto transactions.
Nevertheless, Binance is taking the lead in stamping out romance scams. The global exchange industry leader now has over 70 members in its specialized anti-fraud teams. Last year, 13,000 law enforcement officials reached out to Binance for investigation assistance, and the exchange processed over 58,000 requests for them, enabling them to stop crime and take action against cybercriminals.
One of Binance’s most significant involvements was in an investigation by the US DOJ on a romance scam that resulted in the freezing of $112 million in ill-gotten funds.
The exchange has also invested millions of dollars in training law enforcement personnel to handle crypto-related scams better. It has partnered with agencies across the US, including the FBI, and all around the world to bring down dozens of scammers.
