New York Attorney General Uncovers Major Cryptocurrency Scam Targeting Russians

New York’s Attorney General Letitia James spearheaded an operation against a cryptocurrency scam targeting Russian speakers. The scheme, linked to a Vietnamese team, resulted in the freezing of over $300,000 in assets and the seizure of $140,000. James highlighted the urgency for New Yorkers to remain vigilant against online ads for cryptocurrency investments.

New York Attorney General Letitia James has announced a significant crackdown on a social media-based cryptocurrency scam that primarily targeted Russian speakers. The operation resulted in the freezing of $300,000 in assets, alongside the seizure of an additional $140,000, which included domain names and email addresses associated with the scam. Despite the Southern District of New York’s intention to ease enforcement on cryptocurrency-related cases, AG James remains a vocal critic of the crypto industry. This operation was executed in coordination with various local law enforcement agencies.

Scams via social media are prevalent in the crypto industry today, and this case exemplifies that trend. In her statement, Attorney General James provided key insights about the scam specifics, revealing a Vietnamese team that utilised Russian-language advertisements to dupe countless victims into investing in fictitious exchanges, leading to massive financial losses. “Hundreds of New York investors thought they were putting their hard-earned money in safe, high-return investments, only to be defrauded out of millions. My office took action to stop these scammers and protect New Yorkers,” she stated, urging vigilance among the public regarding online cryptocurrency investment ads.

The duration of the scam’s operations remains uncertain, but local authorities began detecting suspicious posts on Facebook as early as October 2024. The illicit activities predominantly targeted Russian speakers residing in Brooklyn, although the scam extended into other boroughs and areas across the state. While exact losses aren’t publicly disclosed, it’s reported that at least $1 million was swindled from residents in Brooklyn alone.

Law enforcement was able to unravel this scam despite the attackers’ attempts to obscure their Facebook operation. The team, based in Vietnam, used proxy services to manage these ads and encouraged potential victims to shift conversations to the messaging platform Telegram for more intimate discussions. Victims were shown fabricated exchange accounts boasting unnatural growth rates, leading to further investments.

The police’s seizure included $140,000 in cryptocurrency alongside the freezing of another $300,000 and the shutdown of various domain names and email accounts linked to the criminals. Authorities noted that scammers had purportedly spent over $1 million of their victims’ funds in a bid to cover their tracks. This exhaustive effort appears to have diminished their profits, but unfortunately, law enforcement lacks the means to immediately pursue the scammers operating out of Vietnam.

While the court order identifies three suspects, it also mentions that there are likely “unnamed others” involved in the scam. Attorney General James has previously committed to intensifying efforts against crypto criminals, and this crackdown on the social media scam ring certainly aligns with that mission. Despite her ongoing opposition to pro-crypto sentiment, James continues to coordinate with various agencies to confront these fraudulent operations effectively. Despite potential conflicts with city officials, this coordinated investigation involved at least three different law enforcement agencies delivering swift justice.