An individual has reported a loss of $310,000 to a suspected fraudulent cryptocurrency trading platform after being introduced to it through an unsolicited request on LinkedIn.
According to a warning issued by the Securities Division of the Washington State Department of Financial Institutions (DFI) on June 13, the investor had been using a platform known as “Ethfinance.” The DFI revealed that the investor came across Ethfinance after receiving a friend request on LinkedIn. Subsequently, the investor transferred $310,000 from their “DeFi wallet” to the platform in the hopes of generating profits from cryptocurrency trading.
Upon attempting to withdraw some of the initial investment and profits, the investor was informed that additional funds needed to be added to complete a “smart contract” before withdrawals could be made. However, the investor refused to send any more money and has since been unable to access their funds as their account is now locked.
While the DFI has labeled the case as a potential “Advance Fee Fraud,” they have not yet confirmed the allegations. Advance fee fraud involves promising victims substantial returns in exchange for a small upfront payment, only to either demand further payments or disappear altogether.
Washington DFI’s cryptocurrency scam tracker has revealed that EthFinance has been mentioned in a previous complaint where a Californian resident reported losing over $165,000 after being approached by an individual online who claimed to teach them how to profit from cryptocurrency options trading.
The investor became suspicious of the scam when asked by the “CEO of Crypto Customer Service” on Telegram to send 25% of the profits as “taxes” in order to complete the withdrawal process.
In addition to this case, the Washington DFI issued three more alerts on June 13, two of which were related to suspected fraudulent cryptocurrency exchanges and the third being about a fraudulent investment management platform.