What is scam?

Scam is the collective name for various types of fraud and scams. In most cases, the scammer aims to steal as much money as possible from his/her victims or to launder illegally obtained funds. Some scams are more famous than others. Criminals also regularly come up with new tricks. This article discusses three different types of scam: money muling (eg: job scam); the ponzi scheme and the SIM swap. In this article we give tips on how to recognize these types of scam and how to protect yourself against them.

What is Money Muling?

It is attractive for criminals to use bank accounts of innocents to launder their money. In this way, the criminal activities cannot be traced back to their bank account and therefore their personal details. Criminals like to use money mules and devise devious tricks for this.

By offering side jobs, professional looking organizations lure their money mules. The victims think they are working for a legitimate company within the payment provider sector. In reality, money is laundered illegally through their bank account. Money obtained through illegal activities disappears through their bank account and through crypto purchases to criminals.

These criminal organizations work very professionally. For example, courses are often offered to the new 'employees', they receive a contract and are assisted by a manager. Anything to keep up appearances and avoid suspicion. So always check whether your new employer really exists, for example via the Chamber of Commerce. Be suspicious if your bank account is to be used to conduct business activities. In addition, never let anyone use your bank account.

What is a Ponzi scheme?

The ponzi scheme is a form of fraud offering investment methods in which the paid crypto is financed by the investment of new customers (also victim). The crypto are therefore not financed according to the investment plan that is presented to customers.

Participation in the ponzi scheme is prohibited by law. So be careful not to participate in this scam. Do not just work with a party that approaches you via telephone or social media. 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. Also be aware on review sites that these 'customers' may be part of the fraudulent company. Or that a fraudulent person is posing as an employee of a reputable investment company.

What is SIM swap?

In a sim swap, a hacker takes over your phone number. He does this by contacting your telecom provider and convincing the employee to transfer your phone number to his/her SIM card. The telecom provider's employee will have to ask a number of control questions, but these can often be found on social media or are stolen by hackers in the event of data leaks.

If a hacker has taken over your phone number, he can also easily gain access to your email address. He can access your LiteBit account, for example, via your email address, because he is able to change the password of your LiteBit account via your email address.

It is wise to protect yourself against this form of fraud. It is important to stop linking your phone number to your online account for the two-step verification. We would also like to recommend that you use an authenticator app for your 2FA security for this reason.

What if I have been a victim of a scam?

Contact the police, your bank and our fraud department if you have been the victim of a scam.