Crypto Scams Account for 7,300 Takedowns in Australia

In a significant move to combat the growing threat of online investment fraud, the Australian Securities and Investment Commission (ASIC) has successfully taken down over 7,300 websites in just 12 months.

This effort is part of ASIC’s ongoing service targeting fraudulent investment schemes. These schemes often lure unsuspecting investors with promises of high returns through fake investment platforms and cryptocurrency scams.

Key Takeaways:

• Increased vigilance: Investors should be cautious of online investment opportunities, especially those promoted on social media.
• Swift action: ASIC’s partnership with Netcraft enables rapid takedowns of scam websites.
• Continued efforts: Despite successes, ongoing public awareness and industry cooperation are essential in combating the ever-evolving landscape of online scams.

Since the program’s inception in July 2023, ASIC has shut down thousands of fraudulent websites that were promoting fake trading platforms and cryptocurrency investments. These scams frequently spread through social media, leveraging false celebrity endorsements to appear legitimate.

Breakdown of Takedowns

• Total takedowns: Over 7,300 websites
• Fake investment trading platforms: 5,530 takedowns
• Phishing scams: 1,065 takedowns
• Cryptocurrency investment scams: 615 takedowns

The Battle Against Online Fraud: A Game of Whack-a-Mole

Sarah Court, ASIC’s deputy chair, acknowledged the challenges of tackling online fraud, comparing it to a game of “whack-a-mole” where new scam websites pop up as quickly as old ones are taken down.

However, she emphasized that the initiative is “making a difference.” The quick takedown of these fraudulent sites is made possible through a partnership with London-based Netcraft, an internet services company.

Netcraft works closely with domain providers worldwide, allowing it to dismantle scam websites within hours of them being reported to ASIC. The company also tracks similar sites or those operated by the same scammers, ensuring a more comprehensive approach to combating online fraud.

The Role of Social Media in Perpetuating Scams

A significant number of these scams are propagated through social media platforms, making it increasingly difficult for the average person to distinguish between legitimate and fraudulent investment opportunities.

ASIC has warned the public to exercise caution when encountering investment advertisements on social media, particularly those that offer high returns or seem too good to be true.

Sarah Court advises, “If you’re scrolling through your social media feed and see an advertisement that says ‘click on this link and invest money here,’ take a moment to pause. Do your due diligence and bring all your healthy skepticism before considering handing over money or personal information.”

The Wider Impact of Anti-Scam Measures

Despite the challenges, the efforts of ASIC and other organizations are showing results. In April 2023, the National Anti-Scam Centre reported that $2.77 billion was lost to scams in 2023, representing a 13.1% decline from the previous year.

This decrease is notable, especially considering the number of reported scams increased by 18.5%, with over 600,000 cases.

Court attributes this success to a broad range of measures across various sectors, including banking, telecommunications, and government, as well as increased public awareness.

Conclusion: A Cautious Approach to Online Investments

While reducing scam-related losses is encouraging, it highlights the need for continued vigilance among investors.

The complexity and sophistication of online scams are increasing, making it crucial for individuals to stay informed and cautious when engaging with online investment opportunities.

ASIC’s aggressive takedown strategy is a critical step in protecting investors, but public awareness and scepticism remain the best defences against falling victim to these fraudulent schemes.