“On my TikTok, there’s constantly some new Fred Schebesta that comes in and asks people to WhatsApp them about some new hot cryptocurrency project,” Finder boss Fred Schebesta (the real one) says.
“It looks like a scam, and it almost always is, but it’s very hard to stop the bots. It just constantly happens.”
‘I don’t accept phone calls, I don’t click on emails, I don’t respond to text messages anymore.’
Finder CEO Fred Schebesta
Like Green, Schebesta has had his identity stolen and used to sign up for buy now, pay later products. He’s also had particularly ambitious scammers try to set up post office boxes in his name, tactics that have forced the founder to be very cautious when taking calls and messages.
“I don’t accept phone calls, I don’t click on emails, I don’t respond to text messages anymore unless I know who you are,” he says.
The Australian Competition and Consumer Commission (ACCC) generally runs a tight ship when it comes to tracking down and alerting people to scams, with its ScamWatch division tracking 18,000 different scam reports in November alone.
However, the regulator admits its data on the sort of impersonation scams plaguing the crypto space is limited. “It’s not the most common form of these scams that we see, but it’s certainly amongst the ones that have been reported,” deputy chair Delia Rickard says.
Rickard says the regulator has a handful of case studies where victims have fallen for these scams, providing examples where high-profile crypto personalities, such as Ethereum founder Vitalik Buterin and Tesla founder Elon Musk, were impersonated, with the scammers taking between $2000 and $6000 in cryptocurrency from the victims.
Finder’s Fred Schebesta has had his identity stolen and used to sign up for buy now, pay later products.Credit:Louise Kennerley
“It is an awful lot of money to lose,” she says. “The whole investing theory of ‘don’t put all your eggs in one basket’ seems to go out the window when people get involved in crypto.”
She views these scams as a new-age version of the classic celebrity impersonation scam, where scammers try to lure victims into fraudulent investments with the supposed backing of a high-profile celebrity, which has become easier to pull off due to the unregulated and unpredictable nature of the cryptocurrency space.
“Since you can get scammers who operate on legitimate exchanges, I think it’s very difficult for people to know how to go about this,” she says. “So, therefore, they see names that they trust and think it’s a safer move.”
The ACCC hopes to inform more people about the danger of these scams, and also works closely with the banks in an effort to stop money being transferred to scammers before it’s too late. However, the regulator’s power beyond that is limited, leaving much of the action to the social media platforms that provide an avenue for these scammers to operate.
In the early days of the crypto boom, this was predominantly Twitter. However, the company has taken significant steps to prevent these scams from propagating, with a spokesperson saying it was “constantly adapting to bad actors’ evolving methods”. In Australia, promotion of crypto products on Twitter is only allowed with prior authorisation from the platform.
Many of these scammers have since moved to more private services such as Telegram and Discord, where they can message potential victims one-on-one.
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A spokesperson for Discord said the company takes action against any illegal activity on its app, including banning users and shutting down servers. The business has also rolled out various scam protection tools such as suspicious link detection and services which monitor for suspicious activity from new users.
Similarly, a spokesperson for Meta – Facebook and Instagram’s parent company – said the business had a team dedicated to identifying and preventing these sorts of scams.
“While no enforcement is perfect, we continue to investigate new technologies and methods of stopping these scams and the people behind them,” they said.
However, the unfortunate reality of the cryptocurrency sector is that it’s far more difficult to prevent scams when compared to the traditional finance space, as the key tenets of decentralisation and anonymity are both what makes cryptocurrency great, but also allows scammers to thrive.
Rickard says that crypto scams, in general, have gone “through the roof” throughout COVID as more people have been stuck at home on their computers. She blames part of this on the hype associated with the sector, with some desperate investors willing to take risks lest they miss out on the crypto boom.
“I really do think we’re seeing this mentality of people seeing everyone who made a fortune in the first boom,” she says. “So they really want to be in on the next best, big thing.”
