The U.S. Commodity Futures Trading Commission's (CFTC) Office of Customer Education and Outreach (OCEO) has issued a public alert about the rise of Artificial Intelligence (AI) fraud.
As artificial intelligence becomes more prevalent in daily life, scammers falsely claim that they can generate significant returns using bots, trading signal algorithms, cryptocurrency arbitrage algorithms and other AI-powered technologies, according to the official statement:
“The widespread use of social media platforms and influencers has made it easier for fraudsters to spread misinformation. The OCEO advisory warns investors that promises of high or guaranteed returns are signs of fraud. “The public is advised to disregard online promotion of these claims by outsiders.”
“When it comes to AI, this advice tells investors to ‘be wary of hype,'” said OCEO Director Melanie Devoe. Devoe added that artificial intelligence has unfortunately become another tool for bad actors to deceive innocent investors.
According to the official statement, scammers are taking advantage of the public's interest in AI to promote automated trading algorithms, trading signal strategies and cryptocurrency trading schemes that promise unreasonably high or guaranteed returns.
*This is not investment advice.