Officials Warn of a Crypto Scam Where Authentic-Looking Sites Show Fake Profits


The mobile app posted a profit of $2.8 million on what appeared to be a hot trading day on the Singapore stock exchange. But every time the merchant tried to withdraw funds from her home in the United States, she faced customer service representatives asking for payments or mysteriously high tax charges, according to court documents.

US officials say it’s a sophisticated new scam that’s draining millions of dollars from people who let their guard down online. Far from earning $2.8 million, the trader invested $9.6 million in the platform this year before it all went away, according to court documents.

In a November court filing, the Secret Service said five American victims said they were tricked into investing large sums in cryptocurrency this year by scammers who created seven identical domains by spoofing the website of the Singapore International Monetary Exchange. Scammers have also created a smartphone app that mimics what traders use on legitimate platforms, officials said.

According to a warrant filed in federal court in the Eastern District of Virginia in the seizure of the websites last month, a victim in Richmond lost $289,000. Another, in Los Angeles, was drained of more than $200,000. The Redmond, Washington trader, who thought she made $2.8 million in one day in July, said her account showed a total profit of about $7 million.

But the “business profit” displayed on its app was an illusion, according to US officials.

“After numerous attempts to withdraw their investments, they were unable to recover any portion of their cryptocurrency investment,” a Secret Service agent said in the November court filing.

Investigators call him a diet of “butchering pigs”. Scammers find targets on dating apps, social networks or via text messages sent to a “wrong number”. They build relationships with the targets and slowly earn their trust, eventually letting the possibility of cryptocurrency investment linger. Once the money is sent to a fake investment app, the scammer disappears with the funds.

An ex-cop fell in love with Alice. Then he fell in love with his $66 million crypto scam.

Jason Kane, deputy deputy director of the US Secret Service’s Bureau of Investigations, called it “the next generation of the long-running scam.”

“The American public should be aware of these criminals’ dedication to scamming people out of their hard-earned money,” Kane said in a statement. “Fraudsters can identify their victims and coerce them into investing, producing so-called returns on investment to solicit new investments. The public should be vigilant in their online activities, know who they are interacting with, and be wary of any solicitation of funds from an unknown source.

The FBI said the scam originated in China in late 2019. But in 2021, the FBI’s Internet Crime Complaint Center had received more than 4,300 annual complaints related to crypto-romance scams, which had resulted in losses of more than $429 million.

“Scammers use translation programs to communicate seamlessly with their victims,” ​​the FBI said in a press release. “Victims have very similar stories: by meeting someone on a dating app, the scammer gains the victim’s trust and confidence, then claims to have knowledge of cryptocurrency investments or business opportunities that will result by substantial profits.The victim is then tricked into transferring large amounts of cryptocurrency from the exchange account to cryptocurrency wallets controlled by scammers, ultimately losing everything.

The Washington state shopkeeper said she communicated with a scammer through LINE, a Japanese chat app, and WeChat, a Chinese app. The warrant application does not describe how the two met.

Her first investment was $400, authorities said, but a few days later she poured another $100,000 into the platform and ended up losing $9.6 million in total. She said “customer service representatives” would make requests for “taxes” or “fees” every time she attempted to withdraw funds from her account, depending on the warrant request.

In May, a representative of the fake Singapore exchange told the trader that “according to the Financial Income Tax Act, if the total profit for the day exceeds 100% of the principal amount of the transaction, you must pay 30 .6% of the amount of the profit from personal income tax,” US officials said. That meant paying an additional $570,384 in taxes, according to court records.

“Please pay as soon as possible, after payment, we will deduct the tax for you, thank you!” said the representative.

After the merchant made the alleged income tax payments and attempted to withdraw funds, she was told the following month that she had “received 33 abnormal bitcoins” and “your account now belongs to the abnormal state. …you must pay 33 BTC as a security deposit, to ensure that you are not involved in illegal behavior,” the warrant request states.

That’s when the trader “determined it was a scam and stopped making investments,” according to court records.

US officials said the investigation into the fake Singapore exchange was ongoing. Federal prosecutors did not identify the suspects by name. Officials said people who believe they may be victims of a cryptocurrency scam should contact [email protected] or visit to file a report.

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