Boilerroom fraud is a form of fraud in which a fraudulent person usually approaches consumers on behalf of a (fraudulent) organization with dubious investment offers. Consumers are tempted with the offer of high returns if they invest a lot of crypto. In reality, this person and/or the organization turns out not to be able to offer high returns at all and they disappear with the invested crypto of the consumer.
How do I recognize boiler room fraud?
- English speaking
Boilerroom fraudsters often call with a foreign telephone number and speak the English language. So be alert the moment the phone rings. This fraudster will introduce himself as the “account manager”. Do not respond to investment proposals that he/she offers to you via telephone or social media. Hang up the phone immediately and disconnect. Fraudsters can also approach you via social media or by email. An email often contains many language and spelling errors. So check the sender of the email or message.
If the fraudster makes you an offer, it is probably too good to be true. This often turns out to be the case afterwards. The aim of the fraudsters is to gain your trust in the first conversation. They want you to believe that you can actually make big returns. In the background you often hear loud talking and telephones ringing: 'the boiler room'. Fraudsters specifically choose victims with little experience.
- Gaining trust
An essential part of this form of fraud is gaining the trust of the victims. That is the goal in the first phase of the talks. For example, they will first ask you to invest relatively small amounts that entail a return. If you want to withdraw it, the fraudsters will advise you to deposit more money. The fraudsters will continue to contact you and their tone will become more and more compelling.
The fraudsters ask you to create a LiteBit account and send your purchased crypto to the wallet address managed by the fraudsters. Also, some fraudsters will insist on creating a LiteBit account for you (via Anydesk or Teamviewer). The fraudsters then have full access to your account and data. The fraudster is then free to send the crypto to an address that is under their control.
- Money gone
If you then want to withdraw your crypto or want to have it paid out, these criminals will not give up. Or they indicate that you have to make a deposit before you can get your crypto back. This is fraud. You have lost your crypto/money. Also note that (other) fraudsters may contact you afterwards, stating they want to help you get your crypto/money back. Don't fall for this trick. They will ask for upfront fees or more crypto to get the initial investment back. It is impossible to reverse blockchain transactions however.
What can I do to prevent this?
- Be alert to phone calls
Be alert to English speaking people and international phone numbers. Fraudsters can be native speakers in the language of the target victim, but usually will be speaking in the English language. Immediately disconnect if you are approached by phone by an investment company. Be wary of high returns.
- Do not install any programs
Fraudsters have programs with which they can take over your computer with all the consequences that entails. Does a person ask you to download Anydesk or Teamviewer? Don't do that and immediately cut off contact. Immediately remove these programs from your computer.
- Login Details
Never share your login details with third parties. Keep your ID to yourself and don't just give your personal information to someone who poses as an investor over the phone. They are then free to perform actions on your behalf.
- Do Research
Are you in contact with a party that wants to collaborate with you? In any case, always check the internet about the deal first to see what information is known about the company. You can use the website of the Netherlands Authority for the Financial Markets for this: https://www.afm.nl/nl-nl/consumenten/controleer-je-aanbieder/overzicht-waarschuwingen.
What should I do if I have been scammed?
If you have become a victim of these tricks of criminals, it is important to immediately cut off all contact with this party. They will try with cunning stories to get you to invest more crypto/money. But this is part of the trick and this will make you lose more crypto/money. Also remove the programs 'Teamviewer' and/or 'Anydesk' from your computer.
It is then important to report this to the police and to contact your bank. You can also report to us via the website: https://www.litebit.eu/en/security if the fraud has taken place via LiteBit. Under no circumstances can we recover the crypto if the crypto has already been sent to an external wallet outside our control. We also play no role in the mediation.