Personal Finance

‘I stole $20,000 from one woman’: How romance scams are costing victims millions

Key Points
  • Romance scams surged during the pandemic, with losses totaling $547 million last year, up 80% from the year earlier.
  • With any potential partner, there are certain financial red flags to watch out for.
  • Ask questions and never send money, especially cryptocurrency, to someone you only met online.
MTV's Nev Schulman says taking this step can prevent dating app scams
MTV's Nev Schulman says taking this step can prevent dating app scams

"My goal was to get money," said Adekunle Adedeji, a former romance scammer from Nigeria who goes by the name Chris.

While Adedeji, 23, did not pose as a "Nigerian prince," he did tap another long running internet fraud: the romance scam.

Using someone else's photos found on Instagram and pretending to be an American employed by the U.S. military, Adedeji lured women on a dating site and convinced them to send him money. "I stole $20,000 from one woman," he said.

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His ploy eventually unraveled when she discovered his photos were fake, he said. But his guilty conscience also played a role. Adedeji now works with online dating investigation site to educate others on such scams.

Why romance scams are on the rise

Despite an increased awareness from TV series like MTV's "Catfish: The TV Show" and Netflix's "The Tinder Swindler," reports of romance scams hit a record high in 2021, according to the Federal Trade Commission.

Losses totaled $547 million for the year, up nearly 80% from 2020, the FTC said.

"It really spiked with the pandemic because people were stuck at home and had to go online to date," said David McClellan, president of SocialCatfish.

Since 2017, victims have reported $1.3 billion in losses — more than any other kind of fraud that the FTC tracks.

In a common version of the romance scam, people agree to transfer money as a favor to their supposed sweetheart who is in a sudden financial bind, the report found. A new twist often involves sharing bogus investment advice, especially involving cryptocurrency, which is difficult to track.

"Yes, there are red flags, but the most successful scammers are the best at manipulating," McClellan said. "These people are groomed."

How to spot a romance scam

The FTC offers these four tips for spotting a romance scam:

  • Nobody legit will ever ask you to help them by sending cryptocurrency, giving the numbers on a gift card or by wiring money. Anyone who does is a scammer.
  • Never send or forward money for someone you haven't met in person, and don't act on their investment advice. 
  • Talk to friends or family about your new love interest and pay attention if they're concerned. Someone who isn't emotionally involved may be better positioned to spot red flags.
  • Try a reverse-image search of profile pictures. If the details don't match up, it's a scam.

"You also want to watch out for people whose lives seem mysterious," Nev Schulman, host and executive producer of "Catfish: The TV Show," recently told CNBC.

"As alluring and exciting as that might be, if you're going to talk to someone and potentially date them, you want to know what they do and where they are."

Use 'He's a 10 but' to review relationship red flags 

With any potential partner, there are certain dating standards that should be a given, according to Shelly-Ann Eweka, a senior director of financial strategy at TIAA — as well as financial red flags to watch out for, similarly to how the popular "He's a 10 but" meme calls out possible deal breaker traits.

"Money habits can really make or break a relationship," she said.

Early on, look for potential warning signs, she advised, such as living above their means, borrowing money from friends and family or being burdened by debt.

"It's important to make sure your partner's financial habits and values align with yours," Eweka said. "If they don't follow a budget or take advantage of a retirement plan offered by their employer, you can tell that that person is not making good financial decisions."

As you are considering if this is someone you want to be in a relationship with, ask questions such as, "What are your plans for the future? And how do you plan on funding that?"

"How are you going to find your true 10 if you don't know?" she added. "You want to have those tough conversations now to spare yourself from heartache later."

If you do decide to take the next step, Eweka suggests sharing credit reports and meeting with a financial advisor to put together a plan for the future.

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