Have you recently started to deal with a Russian company? Then you need to read this! Online fraudsters are setting up fake companies in Russia to attract victims and steal their money, and their new “modus operandi” is to accept crypto payments only.

Russian private investigators have been receiving a lot of requests to verify companies and conduct due diligence in Moscow, St. Petersburgh, Siberia and other regions, where foreign investors and buyers are attracted to. Currently Russia’s main industries and exports include oil and gas, precious stones and metals, machinery, agricultural products and services. The threats of toughened sanctions on Russia due to the conflict with Ukraine have not reduced trade with this country. On the contrary, businesspeople all around the globe continue to buy goods and services from Russia on a daily basis, but it’s important to remain alert and hire professional help if you want to remain safe from scammers.

How to Identify the Red Flags

Russian private investigators say that all deals involving Bitcoin or other cryptocurrencies must be verified for the sake of safety. A company that accepts crypto payments is not necessarily a scam. Many legitimate companies are starting to accept crypto as a valid payment method. However, there is definitely a red flag when crypto is the only payment method accepted.  If crypto is the only payment option, it’s time to cease contact.

If a seemingly credible company, person or retail establishment claims they cannot accept any form of currency other than Bitcoin, it’s likely a scam. Experts say credible institutions are not likely to accept crypto and not also accept U.S. dollars through normal means like wire transfers, checks, credit and debit card payments. Scammers rely on cryptocurrencies because in general, blockchain lacks the common know-your-customer (KYC) protocols. This means scammers can open wallets without having to present valid identification, a Social Security number, or an address and contact information. Being anonymous makes tricking people easier. It allows criminals to take your money and run, without you ever knowing who took it or where it went to.

How to Navigate Around the Risk

Pay close attention to the information the company you’re dealing with gives you. If a deal sounds too good to be true it probably is, but even if it doesn’t seem extraordinary, the best advice is to hire professional investigators that can verify all of the company’s claims at a local level and with the corresponding authorities in Russia.

Online criminals can buy a domain, create a fake website and fake client reviews in a matter of minutes. What they cannot fake is real evidence from government authorities, public records and company registration records. “We cannot stress enough that reliable evidence is the key to remain safe”, says Charles Wright, Director of Due Diligence at Russia PI.

Another important recommendation is to refuse to download software that allows remote access to your computer. Never give in to pressure or blackmail. Transfer money only after taking the time to think carefully and to properly investigate. Remember to never share personal information or make a payment before performing due diligence.

C. Wright
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