Indian Businessman Loses Quarter Million in Crypto Fraud

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Would you risk becoming a victim of crypto fraud by sending your digital assets to a merchant you don’t know? An Indian businessman did it, and now he’s lost the equivalent of a quarter of a million dollars. The Times of India calls it one of the biggest cyber frauds in Telangana, a state that is home to 38 million people.

An Indian businessman has lost two crores (around $242,000) in just two months due to a fraudulent social media scheme. According to a Times of India report on Thursday, the scammers lured him with promises of high returns and convinced him to invest in their fake crypto trading platforms. The Times of India only identified the victim by a pseudonym.

The victim came across an advertisement for bitcoin trading while browsing Facebook on March 6, the newspaper reported. The link redirected him to a WhatsApp chat page with a Bitcoin website link and instructions for signing up.

Victim used Binance, then handed over assets

However, in a bizarre twist, the victim claims to have downloaded the Binance app to purchase USDT, a stablecoin. Only then did he send the cryptocurrency to the scammers.

This means that the individual navigated through the interface of the world’s most popular crypto exchanges, which can be notoriously complex for new users, and then only turned in their assets.

The anonymous individual would have had access to a virtual wallet where he could watch his investment grow exponentially. However, the scammers insisted on more investments for a full withdrawal. Then, when he refused, they shut down the virtual wallet and the fake website. The businessman is said to have taken out loans from banks, friends and associates to finance his investments. He had hoped to earn 10 crore ($123 million) quickly.

The Times of India has described the crime as one of the biggest cyber frauds to hit the city of Telangana. That’s an understatement in a state of 38 million people.

A similar crypto fraud cost $1.5 million

What is remarkable about this crime is how preventable it was. Many crypto crimes are the result of crypto illiteracy. Although that doesn’t seem to be the case in this case.

According to CryptoLiteracy.org, only 9% of Americans got a passing grade on its crypto literacy test. This is an astonishing number considering that most people who take this test should already be familiar with cryptography. Although India is near the top (4th) in terms of grassroots crypto adoption, so the figure would likely be higher.

However, a recent World Bank report reported that seven countries, including India, are home to half of the world’s 1.4 billion adults without access to formal banking services. So crypto-fraud is not the only concern. Banks around the world are also increasingly offering digital services to their customers. This begs the question: if an educated businessman can fall for a WhatsApp-based scam, how safe are others?

It is not known whether the victim was offered a brokerage service, where crypto is purchased and invested on behalf of an individual.

Another individual said he lost 12.3 lahk ($1.5 million) in a similar fraud the day before the first victim approached the police. We wrote to the crypto exchange company for details. But, it is almost impossible to identify the recipient and recover the amount lost in the investment frauds,” a police official told The Times of India.

Disclaimer

In accordance with the guidelines of the Trust Project, BeInCrypto is committed to providing impartial and transparent reports. This news article aims to provide accurate and timely information. However, readers are urged to independently fact-check and seek professional advice before making any decisions based on this content.

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