Bitcoin investment scam costs Launceston woman more than $40,000

The woman, who spoke with The Examiner on condition of anonymity, said a slick advertising campaign on social media had drawn her in.

The woman said while some scams promise returns that are too good to be true, the opposite could be said of this particular scam and it seemed "pretty legit".

"I'd seen that ad pop up a few times," she said.

"It had Australians talking about (investing) and how they were only trading little amounts every day and slowly building up their amounts.

"It didn't look over the top; it didn't look like it was too far-fetched."

She was told to pay $US250 (~$400) for a "voucher", which would then be redeemed on an investment platform operated by the scammers.

She said it was a "weird way" to invest. However, she admitted that she was desperate to save for a housing deposit as a single mother to children with high medical needs.

The woman said she was worried she could be made homeless as her rental house was verging on being unfit for habitation.

"I was in a really difficult situation," she said.

"Everything had gone wrong one after the other."

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After signing up for the scheme, the woman was contacted by the first of multiple "well-spoken" people who taught her how to set up an account on the cryptocurrency trading platform Binance.

This was done through screen-sharing software, and the woman said she later found cybercriminals favoured it as it afforded them and others remote access to personal computers.

That night, unknown parties attempted to access her bank account from overseas.

Fortunately, the bank froze the account, and the woman said she was not "100 per cent sure" if it was the person she spoke to on the phone or somebody else as that particular person had made a big show of respecting her privacy.

Either way, she decided to leave it at that and write off the initial investment of about $400; however, months later, she was contacted again by a "well-spoken man" who urged her to start investing, with particular reference to her personal circumstances.

Despite initially resisting, the woman eventually capitulated and was given an intensive course on how to trade on currency exchanges.

She was told to purchase cryptocurrency on Binance through Paypal, convert it to bitcoin and then transfer it to a crypto wallet, with the balance eventually reflected on the scam investment platform.

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She started investing small amounts and attempted due diligence, however mixed reviews of the platform did not persuade her either way as "people put in fake reviews being good or bad on any company".

Eventually she had between $40,000 and $45,000 invested and was told by the scammers she was capable of managing the portfolio entirely by herself.

Then, the rug was pulled from under her.

"It would drop and then it would go up," she said.

"Suddenly it dropped and I didn't know how to bring it back up ... it dropped quite dramatically and I was panicking because I could see my money just dropping, dropping, dropping, dropping overnight.

"By the time I got up in the morning ... I already knew it was gone."

She was contacted by the same well-spoken man who urged her to borrow money from friends to fund her account as it was a "golden opportunity" to invest at the bottom of the market.

The woman said this was the final red flag in what she saw, on reflection, as a string that led back to the start.

"There is no way in hell any financial adviser would tell you to go and get money from a best friend," she said.

"That really hit home. It had a terrible sinking feeling."

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She said she felt the scammers had orchestrated the drop in portfolio value and when she told them she would not invest more they got abusive.

The affair led to her becoming a recluse.

"That was the only money I had that could possibly help me and my kids actually secure a home," the woman said.

"That's why it was just so horrible how it all happened and it made me feel so sick.

"You have it happening to a lot of senior citizens, which is absolutely terrible in itself. But when it actually happens to you ... it was a really rude shock. I'd been taken for a ride as well."

The scam was reported to police, and the woman said investigations by INTERPOL had traced the money to an account in Russia, however they were unable to recover it.

She has since engaged the services of a private agency - which she had researched and found to be legitimate - to recover the money, however that process is at a standstill and could take months.

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According to Tasmania Police, Tasmanians have reported 133 cryptocurrency scams since the start of the year.

This has cost about $6 million, with individual losses ranging from $20,000 to more than $2 million.

Detective Sergeant Paul Turner from Tasmania Police's Cyber Crime Unit said the Trevallyn woman's story mirrored several others.

"Criminals use fake identities to develop relationships with their victims," he said.

"Once they have gained trust, criminals claim to be experts in cryptocurrency.

"They then convince their victims to use fraudulent websites or apps, which are controlled by the criminals, to invest in cryptocurrency.

"They coach them through the investment process, show them fake profits, and encourage them to invest more."

Detective Sergeant Turner also urged caution when trying to recover funds, as fraudulent businesses often approach victims offering fake assistance.

Tasmania Police tips to protect yourself from scams:

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