Crypto exchange Debit faces romance scam allegations, CFTC claims $2.3M in losses- bitcoin news

Crypto exchange Debiex faces romance scam allegations, CFTC claims $2.3M in losses- bitcoinnews

The regulatory authority in the United States characterized Debiex as a fraudulent digital asset platform and initiated legal proceedings, accusing the exchange of misusing funds.

The U.S. Commodity Futures Trading Commission (CFTC) has accused senior staff members at the cryptocurrency exchange Debiex of orchestrating romantic relationships with potential customers as part of a scheme to defraud them of their funds. According to a recent statement on January 19, the CFTC alleges that Debiex staff misled individuals, gaining their trust before persuading them to open accounts with the crypto exchange. Despite assuring customers that their funds would be invested in cryptocurrency, the staff is alleged to have misappropriated the funds for personal gain. The CFTC's complaint asserts that unidentified officers or managers at Debiex fostered friendly or romantic connections with potential customers by disseminating false information to build trust, subsequently urging them to open and fund trading accounts with the exchange.

Although only five victims were officially recognized during the span of two years, the regulatory authority contends that the pig butchering scheme resulted in the theft of more than $2 million.

"From around March 2022 until now, it is alleged that Debiex illicitly acquired approximately $2.3 million from about five customers as part of this scheme," the statement highlights.

As Valentine’s Day approaches in a few weeks, people are advised to exercise caution. It is recommended to be vigilant about linking crypto wallets or engaging in crypto services through romantic connections.

In February 2022, Cointelegraph reported that the FBI had issued a warning to the public during the week of Valentine’s Day, cautioning them about the increasing prevalence of romance scammers attempting to convince individuals to send money for crypto investments.

Lately, scammers taking advantage of the popularity of cryptocurrency have been deceiving and exploiting victims for financial gain.

In May 2023, Binance, a cryptocurrency exchange, faced criticism when a Texas woman claimed the exchange should compensate her for an $8 million scam perpetrated by a man she met on Tinder. She contended that Binance was implicated because it provided exchange services to the scammer. However, U.S. Judge Amos Mazzant ruled that there was no evidence of Binance's involvement in the theft.

More recently, romance scammers have adopted a faster strategy to deplete funds, departing from the traditional approach of building trust through extensive interactions on dating apps. In December 2023, Cointelegraph reported on an emerging tactic among romance scammers known as targeted approval phishing. This tactic involves persuading the victim to authorize a transaction, giving scammers access to wallets and enabling them to quickly drain funds.