FTC Warns About Bitcoin Blackmail Scam

FTC, the Federal Trade Commission, an independent agency of the United States government has warned cryptocurrency investors and enthusiasts about bitcoin blackmail scam. FTC was established in 1914 by the Federal Trade Commission Act and it is responsible for protecting America’s consumers.

According to FTC, a bitcoin blackmail scam is targeting various people in USA. This scam targets people in the form of an unidentified letter holding proofs of disloyalty against the victim. In the letter, the scammer wants money in exchange for not disclosing this information to the victim’s spouse, relatives and friends.

In a statement published on Aug. 21, the FTC Division of Consumer and Business Education uploaded a sample text from such bitcoin blackmail scam.

I know about the secret you are keeping from your wife and everyone else. You can ignore this letter, or pay me a $8600 confidentiality fee in Bitcoin.

How it Works?

Scammers are sending letters to men, asking payments in the form of cryptocurrency bitcoin in exchange for not disclosing anything about their alleged affairs. The letter also describes how to use bitcoin to make the payment. The blackmail scam is not unknown. It has many forms and will continue to change as scammers change their strategies to remain successful.

Blackmailing and ransomware are not new in this cryptocurrency world. Scammers or hackers are always searching new ways to steal money from people. In fact, there are some ransomware programs which are contaminating PCs, and are demanding Bitcoin cash to allow users to decrypt their files. The name of this ransomware is Thanatos. What makes this specific attack significant is that it makes an encoded file, however the key isn’t saved anyplace. Regardless of whether unintentionally or plan, there’s no real way to effortlessly open a computer once it’s been compromised. Even if you do pay the ransom, it’s impossible the developers of the malware will ever have the capacity to unscramble your information. In this attack, it creates a ransom note named README.txt. Every time a user logs in, the ransom note is opened by an autorun key named “Microsoft Update System Web-Helper. The encryption part of Thanatos is a wreck, the ransomware introduced something new. This was the first ransomware to acknowledge Bitcoin Cash as a payoff installment.

SamSam is also a new kind of ransomware that has made bitcoins worth $6 million. Its creators have earned more than US$5.9 Million since 2015. It uses a brutally minimalist, manual approach to target and compromise victims. In this attack scammers use different built-in Windows tools to escalate their own privileges, then scan the network for valuable targets. They want username/passwords whose privileges will let them copy their ransomware payload to every machine – servers, endpoints, or whatever else they can get their hands on. Cryptocurrency world is full of surprises. People from various countries have fallen prey to a cryptojacking malwares, hacks, scams,phishing and various different attacks.

A bitcoin blackmailing scam is one such scam and FTC has warned people to stay safe. FTC has called this as a criminal extortion attempt to separate people from their money.

FTC further said,

If you — or someone you know — gets a letter like this, report it immediately to your local police, and the FBI. Threats, intimidation and high-pressure tactics are classic signs of a scam.

Following are some tips given by FTC to stay away from scammers:

Spot imposters: Don’t send money or give out personal information such as a text, a phone call, or an email to anyone.
Online searches: Search for phone numbers to see if other people have reported them as scams.
Don’t pay upfront for a promise: Do not pay in advance for things like debt relief, credit and loan offers, mortgage assistance, or a job.
Consider how you pay: Try to avoid services like Western Union or MoneyGram because it is risky as it’s nearly impossible to get your money back.
Hang up on robocalls: If you receive a phone and hear a recorded sales pitch, hang up and report it to the FTC.
Avoid free trial offers: Before you agree to a free trial, research the company and read the cancellation policy. And always review your monthly statements for charges you don’t recognize.
Don’t believe your caller ID: Technology makes it easy for scammers to fake caller ID information, so the name and number you see aren’t always real. So, do proper online searches before receiving anything.

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