Investors lost a record $5.6 billion from crypto-related financial crimes in 2023, according to a new report from the Federal Bureau of Investigation’s (FBI) Internet Crime Complaint Center (IC3). This represents a 45% increase compared to 2022.

Investment fraud was the most common and costliest type of crypto-related fraud in 2023, according to the report published Monday. Nearly half of the more than 69,000 crypto-related crime reports the FBI received last year involved investment fraud, with scammers making a whopping $4 billion.

Although crypto crimes account for only 10% of complaints received by the FBI, the $5.6 billion loss represents nearly half of the total losses.

Investment scams often promise victims large returns with low risk and have increased in recent years. Last year, the most prominent type of crypto-related investment fraud was what the FBI describes as “trust-mongering” scams.

This type of investment fraud, sometimes called “pig butchering,” involves scams where fraudsters establish long-term relationships with their victims, often through messaging apps, and persuade them to deposit large amounts of money into fake cryptocurrency platforms. It is not possible to withdraw money from these platforms.

According to the FBI report, many victims of these hog-feeding or investment scams have accumulated large debts to offset losses on these fraudulent investments.

While victims aged 30-49 made the most complaints about investment scams, victims aged 60 and over suffered the most losses. Last year alone, victims over the age of 60 reported losses of more than $1.24 billion.

Although IC3 accepts complaints from both US citizens and foreigners, 83% of the crypto-related fraud complaints it received last year were from American investors. The state reporting the most complaints (9,522) and losses ($1.2 billion) was California.

A 2022 investigation by ProPublica – later confirmed by the United Nations and other organizations – found that many crypto investment scammers were being trafficked and forced to engage in fraudulent activities by “pig feeding rings” in Southeast Asia .

The FBI’s report warns US citizens traveling abroad about job posting scams linked to overseas fraud camps. “These camps hold workers against their will and threaten them into participating in fraudulent operations,” the report said.

“Criminals often target people in Asia by posting fake job postings on social media and online job sites.”

Workers are told they must cover travel and other expenses, causing workers to start out with debt, according to the report. Then, they try to pay off their debts while also covering room and board expenses.

Criminals use the worker’s increasing debt and fear of local law enforcement as a mechanism of control. Victims of human trafficking are sometimes sold to different camps, causing their debts to increase further.