Australians reported a record-breaking $37 million lost to Scamwatch last year for dating and romance scams. Total losses are expected to be much higher and scammers are now using dating apps to lure victims into investment scams.
This new technique, called romance baiting, involves scammers meeting people on dating apps and then moving the conversation to an encrypted chat site. After a few weeks of developing a relationship, the scammer will begin asking about the victim’s finances and encourage them to participate in an investment opportunity.
“These scams prey on people seeking connection and can leave victims with significant financial losses and emotional distress,” ACCC Deputy Chair Delia Rickard said.
“While traditional dating and romance scams tend to target older Australians, almost half of all losses to romance baiting scams come from people under the age of 35.”
Scammers often encourage victims to initially transfer a small amount of money to prove how easy the investment is. Victims will be told to top up their accounts to increase their profits but when they run out of money to transfer, the scammer will cease all communication.
Last year Scamwatch received over 400 reports of romance baiting scams with over $15.2 million in losses and the majority involved cryptocurrency investment scams.
“Don’t take financial advice from someone you met on an app and never give financial or personal details to someone you’ve only met online,” Ms Rickard said.
Scammers may use a technique called ‘love bombing’, where they contact the victim several times a day professing their feelings for them. The victim starts to develop feelings in return, making them more likely to participate in the investment scam.
“If you match with someone on a dating app, get to know them in the app as you have more protections than if you move to a different chat site.”
For example, if someone reports a potential scammer on a dating app, the profile can be removed. Other people currently communicating with the scammer on the platform are then protected by the removal of the scammer's profile.
“Remember that you are in control and if you start to feel pressured by someone, stop communicating with them,” Ms Rickard said.
“You can also do an internet search with the name or photo of your love interest or some of the phrases they have used to help identify if it is a scam.”
If you have been the victim of a scam, contact your bank as soon as possible and contact the platform on which you were scammed to inform them of the circumstances.
In 2020, there were 7,314 reports of investment scams with losses over $66 million.