Now scammers target FTX victims with deepfake video of apolgetic founder offering phony ‘crypto giveaway’ through verified Twitter account
- Scammers posted deepfake video of FTX founder Sam Bankman-Fried
- The phony video promised a crypto ‘giveaway’ to customers who lost money
- In reality, the offer is a scam to lure victims into sending Bitcoin
- The brazen scheme was perpetrated using a verified Twitter account
Scammers are rubbing salt in the wounds of FTX customers by using deepfake video of the company’s disgraced founder in an attempt to sucker them out of money.
The collapse of the major crypto exchange earlier this month left an estimated one million creditors facing losses totaling billions of dollars, and in their desperation, scammers apparently see opportunity.
The ‘giveaway’ scam is a simple and ubiquitous one in the world of cryptocurrency, in which the fraudsters ask for donations of bitcoin or other digital currency, and promise to send back double the amount they receive. In reality, they send nothing back.
Real footage of Sam Bankman-Fried in an interview is seen left, while a deepfake video used by scammers to target victims of FTX’s collapse is seen right
The video directed victims to a scam website (above) that has since been taken down
In the scam video targeting FTX users, the deepfake Bankman-Fried says: ‘Hello everyone. As you know our FTX exchange is going bankrupt. But I hasten to inform all users that you should not panic.’
‘As compensation for the loss, we have prepared a giveaway for you, in which you can double your cryptocurrency. To do this, just go to [website redacted],’ the video adds, directing victims to a scam website that has since been taken down.
The fake website used clumsy grammar but sophisticated graphics to lure potential victims, and featured a phony scrolling visual showing purported transactions being sent out from the scammer’s wallet.
In reality, the Bitcoin wallet used by the scammers never conducted any transactions and has a balance of zero.
The scammer’s Ethereum wallet did receive four deposits totaling about $1,400 between October 18 and November 18, according to a blockchain analysis, but it is unclear whether any of these deposits were from unsuspecting victims.
The scam website is seen above. The con works by promising to send double the amount of crypto back for any transaction. The scammer will not send anything back
The deepfake video created by the scammers appears to be based on footage from an interview Bankman-Fried did with Bloomberg Markets and Finance last month.
Adding to the veneer of legitimacy to the scam, the deepfake video was posted by a verified Twitter account posing as Bankman-Fried.
The verified badge was likely obtained during the brief and chaotic rollout of Elon Musk’s new Twitter Blue program, which offered the badge to anyone who paid $8.
The program was suspended after impersonators and trolls ran wild, obtaining the badges and posing as corporations and public figures.
Musk initially vowed to bring back Twitter Blue on November 29, but the rollout has been delayed indefinitely ‘to make sure that it is rock solid,’ Musk said in a tweet.
Meanwhile, the first bankruptcy hearing for FTX was held on Tuesday in Delaware court, where one lawyer for the company, James Bromley, said, ‘What we are dealing with is a different sort of animal.’
‘Unfortunately, the FTX debtors were not particularly well run, and that is an understatement,’ he added.
Stricken crypto exchange FTX was run as a ‘personal fiefdom’ of founder Sam Bankman-Fried, attorneys for the firm said on Tuesday
At the hearing, an attorney for FTX also said the company continues to suffer cyberattacks as bankruptcy begins, and that ‘substantial’ assets are missing.
It appeared to confirm earlier reports that hundreds of millions worth of cryptocurrency had apparently been stolen by hackers in the chaos as the company collapsed.
FTX’s cash balance of $1.24 billion as of Sunday was ‘substantially higher’ than previously thought, a filing Monday night by Edgar Mosley of Alvarez & Marshal, a consultancy firm advising FTX, said.
It includes around $400 million in accounts related to Alameda Research, the crypto trading firm owned by FTX founder Sam Bankman-Fried, and $172 million at FTX’s Japan arm.
FTX, which said on Saturday it has launched a strategic review of its global assets and is preparing for the sale or reorganization of some businesses, had previously said that it owes its 50 biggest creditors nearly $3.1 billion.