A long-running and large-scale internet-based fraud scheme netted around $50 million from dozens of investors over an eight-year period.

The perpetrators created 150 fake sites that targeted investors. These sites would tell the investors that they had multiple investment opportunities that they should take.

According to the court documents, these websites would have higher than normal rates of return on various investments. This attracted investors to these investment opportunities. They made the websites look like legit investment websites that are well-known.

Hackers can leverage artificial intelligence (AI) to create fake websites through several methods, making them more convincing and harder to detect. Here are some ways they might do this:

1. AI-Generated Content: Hackers use AI tools like GPT-4 to generate realistic text content for fake websites. This includes creating authentic-sounding product descriptions, customer reviews, blog posts, and other textual elements.

2. Deepfake Technology: AI can produce deepfake images or videos that appear to show real people endorsing or using a product or service. These can be used to create fake testimonials or promotional material.

3. Phishing Kits with AI: AI-driven phishing kits can dynamically generate phishing pages that mimic legitimate websites. These kits can adapt in real-time to appear more authentic, increasing the likelihood of tricking users.

4. Image Generation: AI tools can create high-quality images, logos, and graphics that enhance the visual appeal of fake websites. Tools like GANs (Generative Adversarial Networks) can generate realistic images that make the site appear more legitimate.

5. Natural Language Processing (NLP): NLP can be used to analyze and replicate the language style of legitimate websites. This helps in creating communication that appears genuine, such as emails, chat responses, and support messages.

6. Behavioral Analysis: AI can analyze user behavior to create personalized fake websites. For instance, by tracking browsing habits, a fake website can be tailored to look similar to frequently visited sites, increasing the chances of deception.

7. SEO Manipulation: AI tools can optimize fake websites for search engines, making them appear higher in search results. This increases the likelihood of users visiting these sites, thinking they are legitimate.

8. Chatbots: AI-powered chatbots can be integrated into fake websites to interact with visitors. These chatbots can provide convincing responses to queries, further establishing the site’s legitimacy.

These techniques make it easier for hackers to create sophisticated and convincing fake websites, which can be used for various malicious purposes such as phishing, spreading malware, or stealing personal information.

There Were 70 Victims and 150 Sites

The fraudsters pretended to be brokers who legit financial institutions employed. Victims would reach out to these brokers, thinking they were real. However, these scammers used many fraud schemes to hide their identities like using prepaid gift cards to purchase the web domain, using virtual private networks, encrypting their apps and phones, and creating fake invoices that would explain the large sums of money being transferred.

Scammers, Be Warned

The FBI continually warns investors about potential scammers and fraudsters on the internet claiming to be brokers or investment advisers. They issue statements explaining that many of these scammers falsely claim that they have all of the proper licenses and registrations with the Securities and Exchange Commission, state security regulators, and the Financial Industry Regulatory Authority (FINRA).

Investors should take the time to complete their research on the Investor.gov website. This way, investors can confirm whether the website is legit and whether the brokers are real. Also, there are three things that every investor should look out for before they fall prey to an investment scam:

1.    High Investment Returns: If a website promises that the investor will make high investment returns, this is most likely a fraud. There is always a risk when it comes to investing, which means that if there is going to be a high return, there will be an increased risk.

2.    Unsolicited Offers: When investors get unsolicited offers about earning an investment that seems to be ‘too good to be true,’ it is probably a scam.

3.    Investment Payment Methods: If someone sees that the website accepts digital asset wallets, credit cards, checks, and wire transfers, then this is probably a scam.

However, continue reading below to learn more about scams you should avoid on the internet.

The Most Common Types of Investment Scams on the Internet

Cryptocurrency Scams

Cryptocurrency is huge because the gains are huge. Which is also why so many people are being scammed out of their money when it comes to it.

It might be difficult to figure out which cryptocurrency website is legit and which one is not, unless you just use Coinbase. Many scammers have been taking advantage of the growing excitement around cryptocurrency and that it is less regulated than other forms of investment.

These scams are supported by paid advertising and posting on social media, making people think that they are honest brokers here to help you. When a person clicks on the post, they will be taken to either the broker or the fake website. These scammers will help the investor make their first investment or give them one to begin with.

Moreover, they use apps like Telegram and Discord to gain more victims. They also use online dating sites and engage in the “Pig butchering” crypto scam. They will encourage people to buy crypto through an exchange or a request. The person will need to send the money to them on their behalf so that they can complete the trade for them. Also, they will tell the victim that they will teach them how to trade and show them their ‘winnings’ on a fake platform.

People will look at this platform and think that they are winning but losing more money because they are continuously investing in it. However, when the person is ready to withdraw their money, there will be a delay or the site will be closed.

Unsolicited Contacts About Investing

Many scammers will pretend to be a broker or a portfolio manager when they email, call, or contact anyone on social media and offer them financial advice. Also, they may claim to be from a legit firm or company that is popular on the internet, but many are not. They do this, so they can appear to be more legit.

When they speak with the person, they will say they are offering them a low-risk investment, giving them high and quick returns. Also, they encourage people to invest in companies that are overseas. This offer will sound legit and look professional, making it harder for investors to pick up on.

Additionally, they are persistent, so they will keep contacting the person. Some will go as far as to say that they do not need a particular government license because they are a part of a genuine company. However, this is all false. The scammers who do this tend to complete cold calls for mortgages, shares, and real estate returns.

Endorsement Scams

With celebrity images and videos, many scammers can entice victims to invest. This has become very popular amongst the cryptocurrency schemes that see people losing thousands of dollars. There are two ways that they typically use celebrity images to scam people:

1.    An advertisement will be made with the celebrity’s image on social media or YouTube. They will claim that the celebrity invested a certain amount of money and made a good profit from it.

2.    Fake news stories are being made about celebrities and their investments. They will make it look like these stories are from a legit site like News.com or ABC News.

Ponzi Schemes

A Ponzi scheme is when the money those new investors put in is used to pay existing investors. There is no real investment, and these schemes usually disappear. Scammers will try to speak with people on social media. They will then ask them to download an app and begin investing.

Every scammer will tell the victim that they will see high returns quickly, which they end up seeing. However, this happens because other people have invested money into the scheme, and the victim is paid with someone else’s money. Then, the scammer will persuade them to make another investment because they’ve just seen a return.

Sometimes, they will encourage the victim to become a part of this scam without realizing it is a fake investment opportunity. Then, when the money dries up, or there are not enough investors, the scammer will disappear.

Share Hot Tips and Promotions

Scammers can encourage people to buy shares in a company that they think will increase in value. The victim may be contacted through social media or email, and the message may also be posted to a forum. They will make the message look like this is an inside tip and that the victim is one of the first people to be ahead of everyone on this ‘trend.’

However, the scammer is trying to boost the stock sales with more people investing in it. Then, they will sell their shares, the value will drop, and the victim will be stuck. The victim will also be left with worthless shares and no money.

Investment Seminars

Investment seminars can be promoted by scammers who claim to be motivational speakers and investment experts. Also, many ‘self-made millionaires’ will claim to know how to help victims make their investments. However, this depends on whether the person will follow a high-risk investment strategy.

This strategy means the victim will borrow large sums of money or buy property or investments. They will then lend this money out with no security, which is risky. The promoters can also charge the victim an attendance fee, sell them overpriced paperwork, and sell them property without getting any advice.

Conclusion

Before investing any money into an opportunity, make sure that they complete their research on the website, the broker, and the company. This will help keep people safe when it comes to investments.

ROBERT SICILIANO CSP, is a #1 Best Selling Amazon author, and the architect of the CSI Protection certification; a Cyber Social and Identity and Personal Protection security awareness training program.