“Red flags” - Episode 1: “The scam is you: how crypto fraudsters make victims do the work”

We're joined now by Sarah Tor, a senior consultant with the financial crime and risk team at EY here in Luxembourg.

Sarah, thank you so much for joining us.

Maybe you can explain how crypto scams work just in general.

What kind of scams do these fraudsters pull off?

I think the first thing I would love to point out about crypto scams when explaining how they work is when people hear crypto, they're thinking about tech.

They're thinking that it's some matrix looking stuff.

It's not.

There is no one sitting at a computer hacking with numbers.

It's all social engineering.

Mostly, I would say it's 99% social engineering.

So crypto scams work by tricking you, not by tricking the computer.

Okay, so if you have a cryptocurrency or some sort of tokenized asset, it's safe, it's secure, nothing's happened, the code hasn't been cracked.

Is that what you're saying?

They don't just need the code.

They need you to do something.

So it could be that your address was leaked, your phone number was leaked, personal information about you was leaked, and they use that to convince you to press the button.

Or you could download something, which is, again, you doing it, that makes your computer press the button.

Okay, we'll get in maybe get into that a little bit more in just a second.

But who is behind the crypto fraud cases? Who's doing this?

Very, very broad.

When people get caught and it's on the news, sometimes they're wanted.

Sometimes they, in recent cases, show off how much sudden money they have so they get found.

And when you look at them, it's a very, very diverse group of people.

I saw recently a big scam where it was a group of people.

They had a very elaborate scheme to steal hundreds of thousands of dollars.