Edmonton police are warning the public about an increase in fraud rates and emerging scams that rely on digital currencies such as bitcoin to extract money from victims.

Reports of fraud and identity theft increased by 89 per cent between 2013 and 2017, police said in a statement Wednesday. Police have seen a further 9.5-per-cent increase in the first nine months of 2018, compared to the same time period last year.

And while fraud rates continue to rise, there is something new about the scams.

Fraudsters continue to pose as police officers and other law enforcement officials in an attempt to extract money from their victims, police said.

"What has evolved is the method of payment demanded by fraudsters," Const.Tuyen Nguyen with the EPS cyber crimes investigations unit said in a statement.

"While gift cards were once the preferred payment of choice, fraudsters are now increasingly demanding payment in other forms such as bitcoin and e-transfers."

Police said cryptocurrency machines are being used by fraudsters posing as tax collectors or police officers threatening to arrest potential victims.

The victims are advised to use ATMs to convert cash into bitcoins, the digital, decentralized cryptocurrency.

"It's a very hard fraud to investigate given that," Const. Kyle Pepper said in a news conference Wednesday. "After the money has been transferred, we can't freeze the funds that are in the machine because it's already been converted.

"It has nothing to do with the owners of the machines, it's just the way cryptocurrency works.

"It's unfortunate. There's been a lot of people that have lost a lot of money."

Earlier this year, Edmonton police posted signs near bitcoin machines at cafés across the city to warn users that government bodies and police agencies do not accept payment for taxes and fines through bitcoin.

However, police continued to receive consistent reports of online fraud and identity theft and "felt additional crime prevention messaging was required," they said in Wednesday's statement.

Pepper said business owners who have bitcoin machines on their properties have been working with police and have often helped to intervene.

He said he spoke with one business owner who estimated he had personally stopped more than $150,000 in fraudulent deposits.

"They are often able to identify the people as they walk in," Pepper said. "The person is on the phone, they look very stressed, they are under a lot pressure and obviously they are depositing large amounts of cash into the machines. So often the business owners themselves have tried to stop these people and warn them."

Police said they are developing a brochure and multi-language ads in an attempt to better educate the public. The ads are expected to appear across the city and online in 2019.

A large number of people victimized by the new scams have been newcomers to the Edmonton area, Pepper said.

"I think a lot of people are being [preyed] on because they are new to the country and they don't know what the CRA can and can't do, so when they get an official-sounding call they think it's true and they act on it, because they don't want to get into trouble with the government.

"[Their actions] come from a good place but it ends in terrible consequences."