"But love is blind and lovers cannot see the pretty follies that themselves commit"

Last Friday, the Department of Financial Protection & Innovation issued a warning about "romance scams and cryptocurrency".  This warning is similar to one issued this month by the North American Securities Administrators Association (NASAA).  The DFPI describes the modus operandi of the romance scammer:

Fraudsters develop fake online profiles on dating apps and other social media sites like Facebook and Instagram. They then reach out to people on the apps and attempt to develop a relationship. The scammer may claim to live in another country, but they are interested in meeting and taking the relationship to another level. They may also suggest you move your “relationship” to a private channel like email or a chat app. When the time is right, the fraudster poses an urgent request for money, and requests you send money via gift cards, prepaid debit cards, or cryptocurrency.

In some romance scams, the fraudster requests that the conversation continue on another app and lures the person into installing fake apps or encrypted apps on their smartphones that leave them open to theft. Scammers will go very far to make the fake app look very similar to a legitimate app.

Once the person agrees to send money to the scammer, they get them to download the fake crypto trading app. The scheme may continue until the person wants to end the relationship or stop sending money and contacts the app to get out their money out. The person may then find themselves locked out of their account and contact customer support only to be talking to one of the scammers. In some cases, the person may be asked to pay an “exit fee” to get their money out.