A young Canberra couple have been ‘financially ruined’ after falling victim to an elaborate overseas Bitcoin investment scam which has cost them around $60,000.
Despite their hardship and urgent search for work to pay the bills, Josie and Nick Yeomans have bravely shared their story as a way of warning others about the increasingly sophisticated nature of investment scams.
Normally astute in financial and online matters, the Yeomans were taken in by an intricate ruse which regularly paid out the expected returns and did not unravel until June this year – more than a year after their first investment.
Nick said he had been following the Bitcoin and cryptocurrency sphere for quite some time before he was told about coinexx.org by an online contact who said he was the acting CEO of the company.
Nick describes the investment opportunity as being a bit like making a term deposit except that you paid in Bitcoin (which the company mined and traded in) and the returns were much greater.
Nick said he started by investing US$1,000 for a six-month term with 10 per cent interest per week, which you received at the end of the six months.
With the promised returns so high, Nick said he was wary that the investment scheme could be a scam right from the beginning. He decided to only invest a small amount of money and see what happened.
The Yeomans had their own account and could log in every day to get updates on their investment, as well as receiving regular contact from the acting CEO. At the end of the six months they made US$2,600 on top of their original deposit. They withdrew some of the money and rolled some of it over into a new term deposit.
“You think, if it seems too good to be true it probably is – until they pay you,” said Nick. “It’s very hard not to believe when it’s money in your pocket.”
The Yeomans were told that if they invested significantly more money then they could withdraw funds every month rather than waiting for six months. They decided to invest US$15,000 and so too did a close friend who had become interested in the opportunity.
The following month they withdrew around $11,000 and said that everything continued to appear aboveboard and as had been agreed.
“We had log in details and every day and every week the amount got updated,” said Josie.
“We had no reason whatsoever to not believe this was a legitimate company,” said Nick.
“I went into it thinking it was a scam but when they paid you again and again and built a relationship with you over time it insidiously works into your life.”
Things were going so well for the Yeomans that Nick decided to leave his public service job so that he could spend more time on the online businesses they were building, as well as with their two young children.
How things unravelled
However, earlier this year things started to unravel. The Yeomans were offered the opportunity to change to making withdrawals every two months (rather than monthly) so that they could get higher interest but when the two months were up they found it hard to get hold of their funds.
They were told that some new regulations had been introduced in England (where the investment company was supposedly based) and they would need to pay fees to help the company meet its obligations.
The Yeomans were starting to get behind on bills and had already taken out another small loan to pay some of the money needed, but were now faced with continual delays in getting hold of their money.
Their original contact seemed to have disappeared and the Yeomans were continually given more reasons for why they could not receive their funds – along with requests for new amounts to overcome the problems.
In the end, when all sources of funding seemed exhausted, they were sent a message from a customer service person they had been dealing with to let them know the whole thing was a scam and that they were not going to get their money back.
‘These scams are unbelievably intricate’
The Yeomans were left “absolutely distraught” by the news and have estimated that they have lost around $60,000 through the scam.
“The whole thing has ruined us – we’ve got no savings, we’re in debt,” said Nick.
“The life that we had basically is completely destroyed and we just have to keep our heads above water.”
Nick said he is looking to go back to work and has applied for about 60 jobs. In the meantime, he has started lawn-mowing and the Yeomans are selling anything of value that they can.
Josie is also looking to go back to work during school hours and has started doing some house-cleaning in the meantime.
The Yeomans estimate that it will take them 18 months to two years before they can get back on their feet financially – but they are intent on getting there.
Nick and Josie hope what happened to them will be a warning to others about how elaborate investment scams can be.
“These scams are so unbelievably intricate for them to drag you along for over a year,” said Nick.
Josie urged people looking to invest to be wary of dealing with an overseas company and to make sure they do more extensive vetting – or better yet, to learn how to invest for themselves and do their own trading.
$18.5 million lost to investment scams this year
An ACCC spokesperson told Region Media that between 1 January and 31 May 2019, Scamwatch received almost 2,000 reports of investment scams, with over $18.5 million in losses. Last year, investment scams cost Australians $86 million in losses.
“Cryptocurrency investment scams are an increasing problem in Australia. Reports of losses to ‘Investments scams’ mentioning ‘crypto’, ‘bitcoin’ or ‘btc’ to 31 May 2019 already exceed those for the entirety of 2018.” The ACCC spokesperson said that these losses totalled $6.06 million.
“Sophisticated investment scams can present professional-looking websites and trading platforms,” the spokesperson said.
“Some will even allow you to withdraw small amounts of money to increase their appearance of legitimacy – before locking your account and stealing your money when you attempt to withdraw larger amounts.”
For more information on protecting yourself against scams please click here.
Original Article published by Glynis Quinlan on The RiotACT.