The Toronto area police are having a field day after 45 citizens reportedly lost a total of hundreds of thousands of dollars in a scheme involving fraudsters, who claimed they were from the government.
Victims of this scam were called at their homes and told that they have certain unpaid tax liabilities. The fraudsters then convinced them to deposit a certain amount of money into a Bitcoin ATM in the city.
One of the victims, who went by the name “Linda” when speaking to the Canadian Broadcasting Corporation, provided details on how she was scammed:
"They're very convincing and they keep at it. They say there's a warrant for your arrest, and York Regional Police will be giving you a call shortly."
This may seem like a routine phishing attack carried out by phone, but according to her later statements, they had plenty of her personally identifiable information. It was enough to make them convincing.
Since she never heard of Bitcoin, it was easy to convince her that the ATM was a special one used by the Canadian tax agency for tax collection purposes. Four hours after the initial phone call, she had already deposited $12,000 that she withdrew from her bank into the ATM.
Because Bitcoin transactions do not leave a paper trail for governments to take action, the money these people paid the fraudsters—a total of over $300,000—is now lost forever.
Although Linda and others who are unfamiliar with Bitcoin and cryptocurrencies may be easy to take advantage of, people who are more crypto-savvy aren’t necessarily off the hook either.