Okcoin warn of ‘elder fraud’ following recovery of $1M in stolen crypto
Scammers who preyed on the elderly were stopped by the coordinated efforts of centralized exchanges.
In a recent blog post, San Francisco-based crypto exchange Okcoin warned about “elder fraud,” adding that the elderly are the highest risk group affected by online scams.
Following an investigation, the company’s risk team intercepted $1 million in stolen Ethereum and Tether and returned the tokens to the rightful owners.
How Okcoin recovered the stolen crypto
The starting point was a report from an 84-year-old user who contacted Okcoin for help after being scammed in April.
“We were scammed and they cleaned out our meager savings. […] Without it we can’t make it. Please help us. Thank you.”
Investigations revealed that the user was one of many victims who an international scam ring had targeted. Investigators estimated that the gang had netted over $4.1 million through their operations.
Critics argue that criminals prefer cryptocurrencies due to their pseudo-anonymous nature. However, in this case, Okcoin was able to monitor the scammers’ wallets using blockchain analysis.
Things came to a head when the scammers tried to launder the stolen funds by sending tokens to an unnamed centralized entity. Although not explicitly stated in the post, it’s common knowledge that centralized exchanges are in contact with one another and agree to freeze accounts suspected of criminal activity.
From there, the $1 million in ETH and USDT was recovered and returned to the victims.
Online scammers target the elderly
Quoting data from a 2021 elder fraud report conducted by the FBI, Okcoin said scammers “routinely target the elderly due to their lack of technical knowledge.”
The report showed that people over 60 are the most vulnerable age group — with the most incidents of scams and the highest loss in dollar terms. By contrast, people under 20 had the lowest number of incidents and the lowest loss in dollar terms.
“The FBI’s 2021 Elder Fraud Report showed that 92,371 Americans over the age of 60 were scammed in 2021, losing a combined $1.7 billion. This is a 74% increase in losses from 2020 and by far the most of any age group.”
In the hope of tackling the issue, the crypto exchange wanted to publicize the most common way the elderly fall victim, the tech support scam.
Tech support scams involve scammers impersonating staff from well-known tech firms, such as Microsoft or Google. They persuade the victim to install remote access software under the guise of fixing a non-existent issue.
Once installed, the scammer can access the victim’s financial accounts and emails. Okcoin recommends checking in on elderly relatives often.