FBI Warns Against Criminals Posing as NFT Developers

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The US Federal Bureau of Investigation (FBI) has issued a warning concerning a growing wave of financial fraud within the Non-Fungible Token (NFT) community. Criminals are masquerading as legitimate NFT developers, taking advantage of internet users keen to acquire these assets.

According to a public service announcement published last Friday, these deceptive actors employ various tactics, such as gaining unauthorized access to NFT developer social media accounts or creating counterfeit accounts that closely resemble authentic ones. 

Once they have control of these accounts, they start promoting purported new NFT releases. Their fraudulent posts often capitalize on a sense of urgency, using phrases like “limited supply” while enticing users with the allure of a “surprise” or unannounced minting event.

Victims are then directed to deceptive websites crafted to resemble legitimate NFT project pages. Unsuspecting users are encouraged to connect their cryptocurrency wallets to make the supposed NFT purchase. However, the wallets are directly linked to malicious smart contracts. This connection enables the criminal operators to pilfer both cryptocurrency funds and valuable NFTs from unsuspecting victims.

To further complicate investigations, criminals often route stolen NFTs and cryptocurrency through various cryptocurrency mixers and exchanges, effectively covering their tracks and obscuring the ultimate destination of the stolen digital assets.

Read more on cryptocurrency mixers: Resurrected Crypto-mixer Launders $100m in North Korean Funds

To safeguard against falling prey to these malicious actors, the FBI said internet users should carefully research surprise NFT opportunities, verify social media accounts, validate website authenticity and exercise skepticism with enticing rewards to avoid falling victim to malicious actors.

The Bureau also urged individuals encountering suspicious NFT-related activities to promptly report them to the FBI Internet Crime Complaint Center (IC3) using the keyword “NFTHack.” 

The FBI added that providing relevant links, social media accounts, crypto accounts or domains used in the scam will aid the investigation.

The security advisory comes weeks after the FBI (and MI5) warned business leaders and academics on July 7 of the seriousness of the espionage threat from China.

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