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May 22, 2021, 10:50 a.m. EDT

Elon Musk impersonators cost consumers more than $2 million in cryptocurrency scams, FTC says

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Ciara Linnane

Consumers have lost more than $2 million since October to scammers impersonating Tesla Inc. Chief Executive Elon Musk in a scheme in which he appeared to say he would multiply cryptocurrency sent to his wallet and send it back, the Federal Trade Commission said Monday.

The agency found that similar scams involving cryptocurrencies have created losses of more than $80 million since last October, an increase of more than ten-fold from the same period a year earlier.

The FTC has received nearly 7,000 reports from consumers in the six-month period and consumers have lost a median sum of $1,900, according to a new   consumer protection data spotlight . The scams come in a variety of shapes and sometimes start as offers of investment “tips” in online message boards that direct consumers to fake investment websites.

See now: Buyer beware: SEC warns investors to avoid coronavirus-related frauds and scams

“Another common form of the scam involves a promise that a celebrity associated with cryptocurrency will multiply any cryptocurrency you send to their wallet and send it back,” said the agency.

See also: Dogecoin is coming to crypto platform Coinbase in 2 months, says CEO

Consumers in the 20 to 49 age bracket were more than five times more likely to be scammed than older age groups, the spotlight found. Consumers in their 20s and 30s lost more money to investment scams than any other kind of fraud and more than half of those were in cryptocurrencies.

The agency is offering guidelines on how to avoid being cheated and said that one sure sign is anyone who says you have to pay to buy cryptocurrency.

“In fact, anyone who tells you to pay by wire transfer , gift card , or cryptocurrency is a scammer,” the guidelines warn. “Of course, if you pay, there’s almost no way to get that money back. Which is what the scammers are counting on.”

Other claims that are big red flags include: scammers guaranteeing that you’ll make money; promises of huge payouts with guaranteed returns; the promise of free money; and claims that promise big returns without including details.

See now: A bitcoin battle of the billionaires ensues as Jack Dorsey faces off with Musk on ‘green’ merits of world’s No. 1 crypto

The FTC announcement comes amid a broad selloff in the crypto complex, led by declines in popular trades, including bitcoin /zigman2/quotes/31322028/realtime BTCUSD +0.84% , dogecoin /zigman2/quotes/226077044/realtime DOGEUSD -1.10% and crypto platform Coinbase Global /zigman2/quotes/225893452/composite COIN +0.93% on Monday.

Don’t miss: Bitcoin, dogecoin lead wipeout of over half a trillion dollars in manic Monday for crypto

Dogecoin, a crypto that was launched as a joke, has fallen more than 36% form its peak near 75 cents put in last Saturday as crypto champion Elon Musk /zigman2/quotes/203558040/composite TSLA -0.04% appeared  on NBC sketch-comedy show “Saturday Night Live.” Musk has repeatedly tweeted about cryptos and caused them to soar in value. Last week, he said he would stop accepting bitcoin as payment for Tesla vehicles, because of the environmental damage caused by mining it.

Read now: Elon Musk tweets about dogecoin, and price immediately jumps

/zigman2/quotes/31322028/realtime
US : CoinDesk
36,715.97
+306.17 +0.84%
Volume: 0.00
June 13, 2021 1:58a
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US : Kraken
0.32
-0.0036 -1.10%
Volume: 9.97M
June 13, 2021 1:53a
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/zigman2/quotes/225893452/composite
US : U.S.: Nasdaq
$ 223.92
+2.07 +0.93%
Volume: 2.38M
June 11, 2021 4:00p
P/E Ratio
77.10
Dividend Yield
N/A
Market Cap
$47.09 billion
Rev. per Employee
$1.02M
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US : U.S.: Nasdaq
$ 609.89
-0.23 -0.04%
Volume: 16.21M
June 11, 2021 4:00p
P/E Ratio
610.44
Dividend Yield
N/A
Market Cap
$587.53 billion
Rev. per Employee
$445,694
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