CFTC issues a warning as romance scams blew up a week before Valentine’s Day

Valentine’s Day is approaching, which means that many will be looking for opportunities, special deals, and other advantages related to the upcoming day of romance. Unfortunately, according to CFTC, there has also been a spike in romance scams, especially the ones involving cryptocurrencies and foreign exchanges.

CFTC warns of romance scams

The Commodity Futures Trading Commission’s (CFTC) Office of Customer Education and Outreach (OCEO) recently issued an advisory notice to messaging and dating apps, as well as social media users, warning them of the new wave of scams where scammers might be using Valentine’s Day hype to try and trick people out of their money.

This particular type of scam is known as sha zhu pan, or pig butchering. The regulator’s warning, published this Wednesday, February 7, explained that fraudsters might offer financial services and/or investment advice regarding dating apps and social media. These are known as romance scams, and they are often quite sophisticated.

Sometimes, scammers spend weeks “grooming” the victim, meaning that they are gaining the trust of someone who they intend to trick at the right moment, usually by recommending their fraudulent scheme.

Crypto promotions could be coming from international criminal organizations

Melanie Devoe, the director of OCEO, stated: “Financial grooming frauds can happen at any time, but Valentine’s Day is a perfect opportunity to remind people that dating and messaging apps and social media can be platforms for scams and fraudulent activity. As the old saying goes, if it sounds too good to be true, it probably is.”

In its warning, the regulator asked all those who use social media, dating, and similar apps to remain vigilant, and be cautious of any messages or texts from strangers, especially if they try to promote cryptocurrency investments. Such texts could easily be coming from international criminal organizations.

Furthermore, due to the nature of cryptocurrencies, anyone who loses their money to such scams is unlikely to ever get it back. The OCEO warns that the scams can often be so sophisticated that even the savviest of investors could fall victim to them.

How to recognize romance scams?

The CFTC also pointed out certain red flags that could help investors and traders identify these scams before things progress to a point of no return.

For example, attempts to move conversations from dating or social media platforms to private messaging apps could be one warning sign, and so could promises of wealth from digital currencies or forex trading due to insider information.

While the CFTC’s warning comes as a good reminder to stay vigilant, scams using social media or dating apps are nothing new. They have been around for years, and even though this is the first time CFTC has warned users against them, other regulators have been doing it for a long time now.