Fake law firms swindle crypto scam victims out of additional $10 million

Fictitious law firms are after cryptocurrency scam victims, and this tactic netted the secondary scammers millions, the Federal Bureau of Investigation (FBI) warns.

An emerging criminal tactic used by cybercrooks to further defraud cryptocurrency scam victims.

Fraudsters on social media and other messaging platforms pose as lawyers representing law firms and claim they have the authorization to investigate fund recovery cases. They may contact crypto scam victims and offer their “services.”

These fictitious lawyers validate the contact by claiming they received information on the scam victims’ cases from the FBI, Consumer Financial Protection Bureau, or other agencies. In other cases, scam victims themselves have contacted scammers on fake websites, hoping to recover their money.

These crooks then build credibility and advance their scams by referencing actual financial institutions and money exchanges.

Scammers further exploit crypto scam victims by requesting upfront payment of a portion of initial fees, with the balance due when funds are recovered. They also direct victims to pay back taxes and other fees to recover their funds.

According to the FBI, in one year, between February 2023 and February 2024, losses from fake law firms totaled over $9.9 million.

The “lawyers” also obtain victims’ identities, as they need personal or banking information “to get their money back.”

“Be wary of advertisements for cryptocurrency recovery services. Research the advertised company and beware if the company uses vague language, has a minimal online presence, and makes promises regarding an ability to recover funds,” the FBI warns.

Users should not reveal their personal identifying information or send any money to unknown contacts. Also, they should beware that law enforcement does not charge victims any fees for investigating crimes.