- Phantom Menace scam uses imposter tech support, government officials to gain trust
- Scammers instruct victims to transfer "compromised" funds to a “safe” third-party account
- The losses are estimated to exceed $542M, almost half of the victims are over 60
The Federal Bureau of Investigation (FBI) has issued a warning about a new scam, which builds on traditional tech support scams. Senior citizens are most at risk.
The new Phantom Menace scam uses imposter tech support, government officials to gain trust, and illegitimate money transfers. This combination of malevolent agents helps scammers identify victims and target them easily.
How does the scam work?
The cybercriminals pretend to be tech or customer support representatives from reputable firms. They convince their victims to call a designated number to get help. Then, they are tricked into downloading software that grants remote access to their accounts and devices.
The scammers deceive victims into thinking their devices are at risk or have been hacked. Then, they gain access to the financial accounts.
Stage two
Nothing new so far. But now, the scam begins to evolve. In stage 2, the scammers pretend to represent legitimate financial institutions and tell victims foreign hackers have compromised their accounts and computers. They instruct them to transfer their funds to a “safe” third-party account, purportedly affiliated with the Federal Reserve or another government agency.
The transfer methods are usually cash, wire, or crypto, and the money is typically sent abroad. Once the victim finds out they’ve been scammed, they are coerced into maintaining secrecy.
Victim losses estimated at $542M
In the first six months of 2023, the FBI’s Internet Crime Complaint Center received 19,000 complaints related to tech support scams. The losses are estimated to exceed $542 million. Almost half of the victims were over 60, accounting for two-thirds of the losses.
Crypto crimes declined overall in 2023
While “Phantom Hacker” scams are on the rise, crypto crimes in general have become less frequent in 2023 according to a Chainalysis report. Financial losses have dropped by 65% y/y. The amount stolen this year is almost $3.3 billion less than in 2022.
Ransomware attacks are an exception. This cybercrime niche gained $175.8 million more between January and June 2023 than during the same period in the previous year.
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