How to avoid scammers in era of digital money

Not so long ago, OneCoin and its criminal mastermind Ruja Ignatova, also known as ‘Cryptoqueen,’ became the only woman on the US Federal Bureau of Investigation’s list of 10 most wanted fugitives.
However, like the morning mist, she disappeared into the airy thinness of time. This was in 2017.
The 40 or so year old Bulgarian is wanted by the FBI for her role in OneCoin, the cryptocurrency scam she founded. The FBI alleges that Ignatova defrauded people who took part in OneCoin of $4b. The scheme had all the makings of a Ponzi.

It promised investors that they could “make lots of money” with “zero risk,” using network marketing and commissions to reel people in.
As with any such scheme, everyone who introduced a new buyer to the platform received a commission.
Here in Uganda, police at the beginning of this year arrested the director of a supposed crypto company that is suspected to have defrauded Ugandans of more than Sh3 billion. CID spokesperson Charles Twine said the suspect reportedly defrauded more than 1,000 Ugandans through online digital transactions between 2018 and 2020 before vanishing.

This and many more examples over the years have made people wary of cryptocurrencies. Thereafter, cryptocurrency has become a byword for “scam”.
However, scams are not the norm when it comes to investing in cryptocurrencies. It is easy to protect one’s investment from a crypto con by noticing certain red flags. 
Only scammers demand payment in cryptocurrency. No legitimate business is going to demand you send cryptocurrency in advance – not to buy something, and not to protect your money. That’s always a scam. 
Then, don’t trust people who promise you can quickly and easily make money in the crypto markets. As with any investment, a digital asset is acquired with the goal of generating income or appreciation. Appreciation simply means an increase in the value of an asset over time. So it is not a get-rich-quick fix to your financial needs.

Those who seek to invest in cryptocurrencies should never mix online dating and investment advice. It is common to meet someone on a dating site or app, and instead of telling you sweet nothings, they want you how to invest in crypto, or ask you to send them crypto, that’s a scam.
Scammers also pose as businesses, government agencies, among other tactics. The most common of which is the investment scam where you are promised that you will make lots of money with zero risk.
These scams often start with an unexpected text, email, or call. In such cases, a fictitious “investment manager” promises to grow your money into a retirement fund. However, the catch is: you can only grow your money if you buy cryptocurrency and transfer it into the so-called investment manager’s online account.

The “investment website” fake manager will introduce you to what looks real. As soon as you log in to your “investment account,” you won’t be able to withdraw your money at all or you shall be asked to pony up high fees so you can gently ride into the sun-dappled paradise of endless profit.
Oftentimes, a scammer pretends to be a celebrity who can multiply any cryptocurrency you send them. But why would, say, football icon Lionel Messi contact you to give you “free money”?
Finally, scammers make big claims without telling you about the details of where and what you are putting your money into.
Legitimate investment managers do not tell you to simply close your eyes and invest, they share the investment information you ask for and will back it up with details.

The author, Mr Martin Orena is the CEO of Digital Money, a Fintech company.
@martinorena