HONOLULU (KHON2) — You are scrolling through social media, Facebook, Instagram, TikTok, when you see a video showing a pile of cash.
All you need to do is invest in a cryptocurrency to access the riches. The promise of a high return in a few days is enticing; however, this could be a con.
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Roseann Freitas, PR and Communications Manager of the Better Business Bureau talks to KHON2 about investing via social media platforms and apps.
Many have heard about scams associated with cryptocurrency and the fraud that can follow for some time. According to Freitas, it has been on Instagram and X; but now, it’s making its way to TikTok.
But what are these scams promising and what does it look like? Often times it’s as simple as this:
- An investor offers to show you how to get a significant financial return for a seemingly minuscule fee.
- Then, you send the money they are requesting via a digital wallet service like PayPal, Zelle or Venmo.
- The person to whom you’ve sent the money indicates that they will invest your money in the market for you.
- They promise that you have a 100% guarantee that your money will triple in three weeks.
- Once this occurs, then they begin tack on additional fees when you go to remove your money from the account. However, after you pay the fee, they keep adding more costs.
- If you question what they are doing, the legality of their actions or whether this is a legitimate enterprise, they utilize scare tactics to bully you into following them. The fear that is most common is that you will be “missing out”.
So, how can you protect yourself from this kind of fraud?
Freitas said to use good judgement. What will the risk and return ultimately be? She also said always do research, even if you think you know how it works, what the cryptocurrency is or what the outcomes can be, there is a risk since you have no past experience with this person/service.
And remember always to discuss your options and what is being asked of you with a financial planner, said Freitas.
Most importantly, don’t be bullied by their scare tactics, said Freitas. They are counting on you being too weak to say no. Always take your emotions out of the situation so you can be clear minded in your assessments and choices.
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Freitas said it is important that you understand who digital wallet services work and be sure to treat digital currencies as you would cold, hard cash.