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$263 million gone: Investment Aussies are losing big on

·3-min read
A photo of Elon Musk is displayed on a smartphone placed on representations of cryptocurrency Dogecoin.
Losses to crypto scams continue to rise even as crypto markets fall. (Source: Getty)

Bitcoin hasn't made a new all-time high in nearly two years, but Australians' losses to crypto scams continue to rise.

Aussies lost a whopping $2 billion to scams in 2021, with the biggest culprit being investment scams ($701 million) and the majority of those scams involving cryptocurrency.

"Scam activity continues to increase and, last year, a record number of Australians lost a record amount of money," Australian Competition and Consumer Commission (ACCC) deputy chair Delia Rickard said.

"Scammers are the most opportunistic of all criminals: they pose as charities after a natural disaster, health departments during a pandemic, and love interests every day."

Data from the ACCC's Scamwatch shows that between 2020 and 2021 there was a 60 per cent reduction in losses from inheritance and unexpected money scams, and only a 1 per cent increase in losses from travel, prizes and lottery scams.

Conversely, losses from investment scams increased by a massive 169 per cent over the same period.

"We have seen a marked decline in some of the older, low-end scams and an enormous increase in more sophisticated 'white-collar' fraud, such as cryptocurrency investment scams," Rickard said.

If it sounds too good to be true...

It's not just dodgy cryptocurrency investment opportunities that Aussies are losing big on either, with a rise in scams promoting traditional investments, which also often end up requiring payment in cryptocurrency.

"We are seeing an alarming increase in imposter bond scams, so we are urging Australians to be very cautious when presented with investment opportunities," Rickard said.

"Investment opportunities that promise a high return with little to no risk are likely to be a scam.

"There was a spike last year in scams relating to pyramid and Ponzi schemes, largely due to the emergence of some sophisticated Ponzi investment scam apps.

"If an investment opportunity seems too good to be true, we urge all Australians to not go anywhere near it."

Nearly $40 million lost in Queensland alone

With cryptocurrency ownership rates at more than double the national average, Queensland has always led the nation when it comes to cryptocurrency, so it's no surprise the Sunshine State is also a big hitter when it comes to getting scammed.

Scamwatch data up to August 2022, shows more than $38 million was lost to crypto scams in Queensland alone, an increase of nearly 100 per cent on the same period last year.

The national figures aren't any better, with $263 million lost already this year, almost double the figure from the same time last year.

Worse than it looks

ACCC chair Gina Cass-Gottlieb said actual losses were likely much worse than the data suggested, with roughly a third of scams still going unreported.

"Once we consider the fact that about a third of scam victims don't report their losses, the real figure lost to scams in 2021 was well more than $2 billion," Cass-Gottlieb said.

"These figures are staggering and represent a severe financial impost.

"What can never be calculated, however, is the emotional toll and the life-changing consequences that can result from these scams and their impacts on individuals, families, and businesses.

"No sooner do we succeed in shutting down one scam, then another springs up in its place."

It's not all doom and gloom though. Cass-Gottlieb sees potential in a co-ordinated approach from government and relevant sectors of private industry.

"I firmly believe that by bringing together government, consumer groups, the financial services sector and the telecommunications sector we can make Australia a much harder target for scammers and prevent, not only the billions of losses that we have seen to date, but also the emotional devastation," she added.

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