Jim Wilkerson, a 74-year-old American, decided to share his story of devastating financial losses in hopes of preventing future victims of cryptocurrency fraud. The man lost more than R$3.6 million on an investment scheme he discovered through a contact on LinkedIn.
The financial tragedy started with the promise of a high return of 24% per month. Attracted by the possibility of big profits, he transferred his money to a cryptocurrency trading platform, which was later invested in the fictional company Sundell-fx.
“The return was 21% to 24%. When I managed to withdraw the money, I thought: OK, this looks real.”
Initially, the returns seemed promising and Wilkerson was able to cash in on the profits, which led him to believe in the legitimacy of the company.
The trouble started when Wilkerson poured more money into the scheme and tried to withdraw some of his alleged winnings. He was then faced with charges of “possible money laundering” and was told to transfer 10% of his balance to a specific address as part of a verification process.
“When I tried to withdraw the money last time, they showed up and said, ‘Oh yeah, your account has been flagged: possible money laundering’.”
When Wilkerson refused to comply, his balance disappeared, leaving him with a loss of $1 million.
Pig slaughter fraud
The scheme the American fell for, known as the ‘pig fattening’, is becoming increasingly common on social media and dating apps.
This scam, which is not related to agriculture, involves a painstaking process where scammers manipulate their victims into stealing large sums of money.
The plan starts with the scammer building a relationship of trust with the victim can take months or even years. Once trust is gained, the scammer introduces a supposed investment opportunity with promises of high returns.
Initially, small amounts are requested for investments, followed by positive financial returns to gain more credibility.
As the victim becomes more confident, the scammer encourages him to invest larger and larger amounts. This process is known as ‘fattening’, where the victim is prepared for the final blow.
At some point, the scammer creates a crisis situation or an urgent need for more money, causing the victim to invest a significant amount.
The scam comes to a head when the scammer disappears with all the money invested, leaving the victim with significant financial losses and often additional debt. This type of fraud is particularly insidious because of the emotional manipulation and building of a relationship of trust before executing the financial scam.
How to protect yourself
Authorities warn that anyone can be targeted by these scammers, who often use fake profiles and lure victims with promises of love or lucrative financial partnerships.
Extreme caution should be exercised in investments suggested by new online contacts and to verify the legitimacy of any investment opportunity before committing any funds.
The Washington State Department of Financial Institutions has already issued a warning about Sundell-fx. Additionally, the FBI emphasizes that this type of investment fraud is becoming increasingly common, with victims reporting losses of more than $3.3 billion in 2022.
The FBI warns that scammers often use social media and networking platforms to lure victims, and that transferring money to cryptocurrencies increases risk due to a lack of regulation.
Wilkerson, who is now dealing with the consequences, hopes her story serves as a warning. He advises being careful with business offers that seem too good to be true.
Source: Live Coins
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
