Brooklyn DA Dismantles International Crypto Scam Operation

The Brooklyn District Attorney's office has taken down the digital infrastructure of a wide-ranging cryptocurrency fraud that extracted tens of millions of dollars from Russian-speaking victims throughout the United States.

In coordination with the FBI, investigators served search warrants spanning three time zones within a short time frame, taking control of or disabling 241 fraudulent domains and over 100 cloud servers operated by Eastern European and U.S. firms. Those servers contained the criminals' victim databases, website materials, and operational programs, a Wednesday statement said.

“Our groundbreaking Virtual Currency Unit identified the fraud, tracked the stolen cryptocurrency, broke new ground by uncovering the infrastructure behind the operation, and worked with the FBI to dismantle it,” stated Brooklyn District Attorney Eric Gonzalez.

“By disrupting more than 100 servers and hundreds of fraudulent websites, we have struck at the heart of this criminal enterprise and made it far harder for these scammers to victimize others. I commend our investigators and thank the FBI for their partnership in this extraordinary operation.”

Victims were drawn in by investment advertisements in Russian on Facebook. Afterwards, a Russian-speaking "advisor" would telephone and guide them through setting up an account on a counterfeit cryptocurrency exchange and purchasing digital tokens.

After weeks or months, when individuals attempted to cash out, they found themselves locked out or faced with fabricated "fees" and "taxes."

For some, their entire life savings disappeared. The fraudsters then returned, pretending to be recovery specialists, reaching out to victims weeks afterward and offering to get back the stolen funds.

The Virtual Currency Unit had previously dismantled 400 fraudulent domains, yet fresh ones consistently emerged. Targeting the underlying servers prevents the scammers from rapidly establishing new websites or contacting previous victims.

Over the three-year probe, roughly $300,000 has been retrieved to date, and prosecutors indicate they are pursuing additional asset recovery.