Scammers have targeted DeFi users who find it difficult to identify that they have clicked on malicious links due to slight changes to the official URLs.

In the latest wave of cybercrime, cryptocurrency users have lost more than $4 million in funds to crypto criminals. Many thefts were carried out through phishing sites advertised on Google Ads.

These fraudulent websites mimicked legitimate cryptographic platforms to trick unsuspecting users into entering their login credentials, private keys, or other sensitive information. Once the criminals obtained this information, they were able to access users’ cryptocurrency wallets and steal their digital assets.

ScamSniffer, a provider of anti-fraud services for Web3, has recently reported many malicious ads from phishing websites in Google ad searches. Over the past month, scammers saw a 276% profit from their illegal activities due to the number of users affected and the money they used to promote their fraudulent ads.

These bad actors have affected various decentralized finance protocols, websites, and brands, including DefiLlama, Lido, Orbiter Finance, Radiant, Stargate, and Zapper. Scammers have targeted DeFi users who find it difficult to identify that they have clicked on malicious links due to slight changes to the official URLs.

Regarding this problem, ScamSniffer has commented on the following:

“When you open a malicious advertisement from Zapper, you can see that it attempts to obtain authorization of my $SUDO by using a Permit signature. If you have installed the Scam Sniffer plugin, you will receive real-time risk alerts.”

Crypto Scammers Have Used Many Tactics to Perform These Scams

ScamSniffer reports that scammers have implemented a variety of tactics to circumvent Google’s ad review process, including manipulating the Google Click ID parameter, using anti-scrubbing techniques, and employing parameter distinction. These methods allow scammers to display a legitimate webpage during Google’s ad review process.

ScamSniffer’s analysis of addresses associated with fraudulent websites promoted by scammers reveals that cryptocurrency users lost approximately $4.16 million in the last month, with more than 3,000 people affected by the scams.

In addition, anti-scam measures tracked the movement of funds on the blockchain to different exchange and mixing services, such as SimpleSwap, Tornado Cash, KuCoin, and Binance. The scammers spent approximately $15,000 advertising their websites, getting a 40% conversion rate from 7,500 users who clicked on the malicious ads.

Metadata analysis of various phishing websites has connected the responsible advertisers with two main locations: Ukraine and Canada.

Increase in Phishing Attacks within the Crypto Space

Crypto criminals have previously exploited Web2 tools and services to steal funds from Web3 users. For example, in 2020, they hacked the Twitter accounts of high-profile figures, including Elon Musk, who asked users to claim free crypto tokens via links to a malicious website.

Fraudsters have frequently used phishing attacks to steal cryptocurrency funds from users. DeFi, in particular, remains a preferred target for hackers, with more than $3.7 billion siphoned off in 2022 alone.

In order to minimize the risk of falling victim to scams, ScamSniffer suggests that “users should exercise caution when using search engines and actively block content in the advertising area.” Likewise, Google Ads must “strengthen its review process for Web3 malicious ads to better protect users.”

By Audy Castaneda

The police are now investigating to understand what happened.

An elderly man living in the East Lyme region of Connecticut allegedly lost over $60,000 worth of crypto to scammers. The alleged crime is being investigated.

East Lyme Resident Loses Lots of Cash and Crypto

Michael Finkelstein, chief of the East Lyme Police Department, says crypto scams have become an ongoing problem in his state and his department heads receive almost regular calls from people who believe they have lost money or been victimized. He commented in a recent interview that the $60,000 sum in question has been the largest yet, and urged the residents to exercise caution, in the following terms:

“The East Lyme Police Department urges residents to always keep themselves and their accounts safe, and use extreme caution when contacted and told to provide any funding to individuals. We are hopeful that continuing to shine a light on these constant scams will help keep our residents safe.”

It is alleged that a relative of the victim contacted East Lyme Police to inform them of what was happening. At the moment, the identity of the victim has not been revealed. He is only mentioned as a “senior citizen in the community” in documents related to the matter. The relative said the man had received a call from someone claiming that fraudulent charges had appeared on his bank statements.

From there, the man was transferred to a second person who claimed to be a lawyer. The person then instructed the victim on how he could send a payment to settle the charges. He had to withdraw a certain amount of money without telling anyone, then travel to a nearby Bitcoin ATM and convert the cash into crypto. The money could then be loaded into a digital wallet and sent to the lawyer (aka the scammer).

According to earlier reports, the victim was prompted to tell bank staff, in case they asked about the reason for the withdrawals, that the money would be used to purchase a car or to renovate an apartment.

Up to $60,000 was converted into BTC. There is good news in that members of the investigative police force were able to recover about $40,000, although another $20,000 still remains. Finkelstein said that cases like these tend to be difficult because most cryptocurrencies cannot be recovered once they are sent. He further added that “in so many of these cases, life savings are stolen and not recoverable.”

Scam That Happens Too Often

Crypto scams have become extremely prominent in recent years. Many of them take the form of romance scams, in which hackers target those seeking love online. Once they find people they feel they can victimize, they know them well enough to convince them to invest in fake crypto platforms.

Once they do, they start to see returns, though problems do arise when they try to make withdrawals and often cannot get their funds back unless they invest even more.

By Audy Castaneda