YouTube crypto scam robbed Tether investors of at least $100,000
A scam network run by a “tightly coordinated” group of criminals targets potential crypto investors with thousands of videos promoting fraudulent Tether mining schemes, according to a new report by WithSecure.
Researchers at a cybersecurity firm WithSecure have discovered thousands of YouTube videos advertising fraudulent web-based apps that pose as USDT (or Tether) cryptocurrency investment schemes.
Hundreds of YouTube channels, some with a significant number of subscribers and view counts, were found to post new videos on a daily basis. Some of these channels are YouTube-verified accounts, the report said.
The network is believed to consist of a “tightly coordinated” team of about 30 members who use Telegram for communications and running operations. The group has designed its YouTube channels to game the platform’s recommendation algorithms and boost engagement of scam videos, researchers said.
Scammers were found to use automation to copy-paste comments to videos to make them appear legitimate. Meanwhile, description fields attached to the video employed a unique style of search engine optimization, or SEO, in an attempt to trick YouTube’s search functionality, WithSecure noted in the report.
“They’ve clearly figured out how to game YouTube’s recommendation algorithms by using a fairly straightforward approach,” WithSecure Intelligence Researcher Andy Patel said, adding that “more could be done to protect people from these scams.”
Using data capture and analysis techniques, researchers found over 700 URLs associated with fraudulent investment apps but said associated cryptocurrency wallets indicated there could be thousands more. They found YouTube hashtag #usdtmining to contain over 3,900 similar videos.
While mapping the flow of money in these operations is “extremely complicated,” WithSecure was able to identify a set of 900 victims and said just over $100,000 were lost to the scam between July and November last year.
The network seemed to be targeting existing cryptocurrency investors, while low-quality videos in different languages without localization indicated “a pretty opportunistic approach,” Patel said.
“But as that volume increases, so do the odds of them getting lucky and finding someone able and willing to invest more substantial amounts,” Patel noted.
Online cryptocurrency scams are an increasing problem. According to the Federal Trade Commission, 46,000 people reported losing over $1 billion in crypto scams between the beginning of 2021 and June 2022. Half of them said the scam started on a social media platform.
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