Title: Beware of Crypto Scams: Fake Lawyers Target Victims in Multi-Million Dollar Fraud
Introduction:
Cryptocurrency scams continue to plague unsuspecting victims, with criminals finding new ways to exploit their vulnerability. One alarming tactic involves fraudsters posing as lawyers, promising to recover stolen funds, only to defraud victims even further. The FBI has issued an alert, warning individuals of this growing threat.
Rising Threat: Scammers Impersonating Lawyers
In a recent public service announcement, the FBI revealed that criminals are now impersonating lawyers representing fictitious law firms. These fraudsters use social media and messaging platforms to contact victims of crypto scams. To gain victims’ trust, they claim to be working with government agencies like the FBI or CFPB. Some victims even find themselves on fake websites, hoping to recover their funds.
Sophisticated Tactics: Extracting Personal Information and Fees
Between February 2023 and February 2024, fake law firms managed to scam victims out of over $9.9 million, according to the FBI Internet Crime Complaint Center (IC3). These scammers ask victims to submit personal or banking information to verify identities or facilitate fund recovery. They also request upfront fees, often disguised as back taxes or other expenses.
Law Enforcement’s Role: No Fees for Investigation
The FBI emphasizes that law enforcement agencies do not charge fees for investigating crimes. If someone claims to be affiliated with the FBI, it is crucial to verify their credentials by contacting the local FBI field office. This reminder serves as a critical safeguard against falling victim to these scams.
Crypto Scam Recovery: Pursuing Civil Litigation
Recovery companies in the private sector lack the authority to issue seizure orders and recover stolen cryptocurrency, as stated by the FBI. Cryptocurrency exchanges can only freeze accounts internally or in response to a legal process. Victims must pursue civil litigation to recover their lost funds.
Rapid Growth: Cryptocurrency Investment Fraud
The FBI’s report reveals a significant increase in investment fraud involving cryptocurrencies. From 2022 to 2023, losses due to cryptocurrency scams rose by 53%, amounting to $3.96 billion. The agency had previously warned of a surge in crypto investment schemes seeking to defraud American citizens.
Recycling Victims: Targeting the Already Victimized
The Commodity Futures Trading Commission (CFTC) highlights a common tactic employed by recovery-fraud scammers – targeting their existing victims. After misappropriating funds, fraudsters retain personal information and later contact victims, posing as government officials, recovery-service representatives, or attorneys. They claim to have the funds in hand or are working with the court for distribution. Victims are then asked to make payments for donations, retainers, or overdue taxes, with requests for more funds often following.
Widespread Impact: Riskiest Scams and High Monetary Losses
According to a report by the Institute for Marketplace Trust, investment and cryptocurrency scams topped the list of “riskiest scams” in 2023. A staggering 80.4% of victims reported monetary losses. This data underscores the urgent need for awareness and caution when dealing with cryptocurrency investments.
Recent Case: Chinese Nationals Charged in Multi-Million Dollar Scam
In May, the U.S. Department of Justice charged two Chinese nationals involved in a cryptocurrency scam that laundered over $73 million from victims. This case highlights the “pig butchering” scam, where fraudsters establish trust with potential victims before disappearing with their money. Such instances serve as a reminder of the ever-present threat and the necessity for vigilance in the crypto world.
Conclusion:
As cryptocurrency scams continue to evolve, it is crucial for individuals to remain vigilant and informed about the latest tactics employed by fraudsters. The FBI’s warning about fake lawyers targeting victims provides valuable insights into this specific threat. By understanding the methods employed by scammers and the appropriate actions to take, potential victims can protect themselves and their investments from devastating losses.
