Florida residents lose millions a year in cryptocurrency schemes

ORLANDO, Fla. – In the world of fast money, investors in Florida are chasing the big payoff promises of cryptocurrency deals only to learn the high returns were all hype.

Brian Watson, a financial investigator for the Orlando branch of the U.S. Secret Service, told News 6 Florida investors lose an estimated $50 million to $100 million a year in crypto investment deals.

“They end up losing all of it,” Watson said. “They’re trying to get their hook in you. They’re trying to get your money.”

Watson has tracked social media crypto deals that offer 1 to 2% a day in profits but never make the mark.

[TRENDING: Become a News 6 Insider]

Usually, the investment deals only pay a few investors anything, leaving the majority with big losses in what Watson calls a crypto Ponzi scheme.

“Some of these guys close one Ponzi scheme and they roll into a new one,” Watson said. “Then they use the money from the new scheme to pay the victims of the old one.”

News 6 found advertisements on YouTube and other social media platforms packed with hosts who offer “investment projects” along with websites they claim offer proof of profit backed by graphs that are simply generated to convince investors their accounts are doing well.

Watson recalled the typical sales pitch.

“‘Oh we’ve got this new project, you’re going to make some money every day,’” Watson said.

In a recent case, Secret Service agents returned a major portion of funds to investors, yet they were upset because agents shut down the project before they could make a profit.

More than $10 billion in losses from online scams were reported to the FBI in 2022, the highest annual loss in the last five years, according to a new report from the FBI.

LendingTree reports that of those who have invested in crypto, 28% sold it for more than it was worth. But a higher rate of investors — 38% — sold their crypto for less than it was worth when they bought it. Another 13% broke even.

“Make sure you have a clear understanding of what your money is doing,” Watson told News 6. “If you don’t understand what your money is doing, then you probably shouldn’t be involved in it.”

Get today’s headlines in minutes with Your Florida Daily: