SEC Issues Warning for Investors Pertaining to Social Media Crypto Promotions

The Securities and Exchange Commission (SEC) of the United States has recently issued a warning for local investors. The warning issued is for the US locals against the scammers who are coming up with different ways of scamming.

Scammers Exploiting FOMO Sentiments

In the warning, the Securities and Exchange Commission has intimated the investors about the tactics being used by the scammers.

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In an attempt to lure investors and steal their finds, the scammers have been exploiting the ‘fear of missing out sentiments through social media platforms.

According to the SEC, if a cryptocurrency platform or an exchange offers profits and gains that are too good to be true, then it is definitely a fraud.

In order to defraud people and steal their funds, scammers have adopted modern-day tactics. They have turned to social media platforms where there is an abundance of millions of users.

Investor Education and Advocacy

It is the Investor Education and Advocacy Office at the Securities and Exchange Commission that has issued the warning for the investors.

The warning has asked the investors to be extra careful whenever interacting with social media posts. They must be mindful of the fact that scammers have been using social media platforms to lure investors.

The regulator has asked the investors not to believe in any social media posts claiming huge profits and returns for investing in cryptocurrencies or digital assets.

Scammers Exploiting Sentiments of Investors

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Although the crypto sector is currently witnessing a low trend, it is still tempting enough to attract any new investors.

The scammers are cashing in on such sentiments of the investors and they are luring them with fake statements and promises.

For this purpose, the first attempt that the scammers are making is to use the social media platform to advertise a scheme or a digital asset.

They use all major and popular social media platforms to put the word out. This way, they are able to publicize their products on a large scale, creating as much traction as possible in the investment sector.

The giveaways for the fraudulent attempts involve claiming that no risks are involved in investing in cryptocurrencies, or promising very high returns.

Fabricated Facts

The scammers use fake and forged proofs and data in order to show it off to the targeted investors. This is another tactic adopted by scammers to lure investors and compel them to entrust them with their money.

Based on the above possibilities, the SEC has warned the locals that they will be eligible for no compensation if they end up getting defrauded by the scammers.