Binance, the world's leading cryptocurrency exchange, has shed light on its strategies to safeguard users from scams. The company highlighted that the surge in online dating has coincided with an increase in "romance scams."
In a statement on its website, Binance explained that romance scams typically involve a fraudster deceiving a susceptible individual on an online dating platform. The scammer establishes trust with their victim before eventually defrauding them of their money. Tigran Gambaryan, head of Financial Crime Compliance at Binance, drew parallels between these scams and his previous experiences as a Special Agent at the Internal Revenue Service. He said, "Reflecting on my experiences as a Special Agent [at the Internal Revenue Service], I see a striking similarity in tactics. These manipulations are not unlike the schemes I’ve seen where fraudsters sell lies to get their hands on your money. The essence of their approach remains the same: exploit trust and fabricate connections to achieve their deceitful ends."
The prevalence of romance scams is growing, according to data from various sources cited in Binance's post. The 2023 Norton Cyber Safety Insights Report found that over 25% of respondents worldwide had fallen victim to online dating scams. Data from the U.S. Federal Trade Commission indicates that romance scam complaints rose from 11,235 in 2016 to nearly 70,000 in 2022. While most of these scams involved traditional currency, about 34% were related to cryptocurrency. On average, victims of romance scams in the U.S lost close to $14,000.
To protect its clientele, Binance collaborates with law enforcement agencies globally and provides training on best practices for targeting scammers. In 2023 alone, Binance responded to over 58,000 requests from law enforcement and recently worked with the FBI and U.S Department of Justice to seize more than $112 million linked to scammer groups. The company also uses monitoring tools to detect fraudulent transactions and provides educational resources to its users to enhance their understanding of common scam tactics.
Erin Fracolli, the global head of Intelligence and Investigations at Binance, stressed the importance of cooperation with law enforcement during an episode of the Crossing the Chain podcast. She said, "We work very closely with law enforcement; that’s the main purpose of our team, is really to collaborate with law enforcement, work together to come up with solutions to investigations problems, to really go above and beyond and work proactively to identify threats facing our users and also facing the larger crypto ecosystem."
Launched in 2017, Binance has grown into the world's largest cryptocurrency exchange, according to CoinMarketCap. As of August 2022, it had a daily trading volume of approximately $76 billion. Binance lists over 350 tokens and allows users to buy, sell, and store digital assets.