Online cryptocurrency scam results in loss for California investor

The California Department of Financial Protection and Innovation (DFPI) has received a complaint from a California resident regarding cryptocurrency fraud.

A California resident told DFPI he met a woman on WhatsApp who asked him to invest on the trading platform https://www.jsgj121.com saying that he would double his money. The scammer described an elaborate scheme called “lossless mining,” defi mining, and on-chain node mining methods following Bitcoin and Ethereum. The scammer said that the user joins the community to become a virtual miner, which required a miner fee to activate the on-chain node docking mining interface used to mine Ethereum for a 24-hour cycle, and that evey day at 12 noon Washington time, any earnings would be deposited in the user’s wallet. The victim was told there was no risk of transfer out, and that this program could create millions of income every year. The victim sent $8,000. But when he tried to withdraw his profits, he was told he needed to pay income taxes. He then reported the page to FTC and said the platform disappeared, but the women is still online looking for more victims to invest. These allegations have not been verified by DFPI.

This appears to be what is commonly called an “Advance Fee scheme,” which can take many forms, as discussed here: https://www.fbi.gov/scams-and-safety/common-scams-and-crimes/advance-fee-schemes.

In addition, the DFPI cautions against so-called imposter scams, where the scammer pretends to be someone else, here, another legitimate website. More information is available here: https://consumer.ftc.gov/features/imposter-scams.

The DFPI urges consumers to exercise extreme caution before responding to any solicitation offering investment or financial services. To check whether an investment or financial service provider is licensed in California, consumers may contact the Department for questions or inquiries at ask.dfpi@dfpi.ca.gov or call toll-free at (866) 275-2677. If a consumer believes a person or company has violated state law or acted improperly regarding a consumer financial product or service, they may file a formal complaint with the DFPI at https://dfpi.ca.gov/file-a-complaint/.