US to return $7M to victims of ‘spoofed’ crypto investment websites
US authorities are currently focused on returning $7 million to the victims of a sophisticated social engineering scam that duped individuals into sending funds to fraudulent cryptocurrency investment platforms. The scheme was characterized by fraudsters establishing trust with victims before directing them to counterfeit websites that presented themselves as legitimate investment opportunities. According to a statement from Virginia’s Eastern District US Attorney’s Office, a significant number of victims were caught in this web of deception.
Once victims deposited their funds, the money was transferred through over 75 bank accounts linked to sham corporations. These funds were misleadingly described as domestic transactions, despite being routed to foreign banks. This complex financial maneuvering was designed to obscure the true nature of the transactions, allowing the perpetrators to vanish with the victims’ investments.
The fraudulent sites falsely assured victims of substantial gains on their investments, further entrenching them in the scam. However, when victims attempted to withdraw their so-called earnings, they were met with additional demands for money, often under the pretense of needing to pay taxes on fictitious profits. This tactic kept many victims entangled in the scheme as they sought to reclaim their funds.
In 2023, the United States Secret Service successfully seized a portion of the stolen money from a foreign financial institution. Following this, a civil forfeiture action was initiated in a US District Court. The bank also laid claim to the seized funds, which led to a settlement agreement, allowing $7 million to be returned to victims. Those affected by the scam are being encouraged to reach out to the Secret Service to file petitions for the recovery of their financial losses.
The ongoing issue of cryptocurrency-related fraud has been highlighted in the 2025 Crypto Crime Report from Chainalysis, which indicates that cybercrime in the digital currency space has evolved into a professionalized arena dominated by organized groups. Furthermore, the Australian federal police reported that they had to alert numerous individuals about a message scam targeting cryptocurrency users. This scam impersonated legitimate exchanges, including Binance, to phish sensitive information from unsuspecting users.
Additional scam incidents reported within the crypto community include spoofing attempts that falsely claimed to be from Coinbase and Gemini, aiming to trick users into setting up wallets that would inevitably compromise their accounts. Cybersecurity experts are also expressing concerns over new malware forms designed to steal funds, hidden within altered versions of trading platforms like TradingView. Furthermore, Microsoft’s Incident Response Team identified a new remote access trojan targeting cryptocurrency wallets in popular browser extensions.
In light of these developments, it is evident that the landscape of cryptocurrency remains fraught with risks, prompting regulators and law enforcement to take decisive action against fraudsters while also educating potential victims on the prudent measures to protect their investments.
