"Feds Seize $8.2M in Crypto: A Tale of Trust, Deception, and Recovery"

US authorities are set to return $8.2 million in cryptocurrency to victims of a sophisticated scam involving fraudulent messages and a fake investment scheme. The funds were seized from three scam addresses and have been frozen pending a court decision.

The scam, which targeted individuals through seemingly harmless messages sent to random phone numbers, involved befriending the recipient, gaining their trust, and eventually convincing them to invest in a crypto scam. The FBI has identified 33 victims, with another five still to be identified, and total losses amounting to $6 million.

Investigators conducted a blockchain analysis after a victim filed a complaint with the FBI's internet Crime Complaint Center in June. They discovered that a portion of the stolen funds had been converted into Tether (USDT) and transferred to the three cryptocurrency addresses.

Acting US Attorney for Ohio Carol Skutnik and assistant US Attorney James Morford filed a forfeiture complaint in an Ohio District Court on February 27, asking the court to have all the funds in the three addresses forfeited so they can be returned to the victims. The complaint revealed that the accounts contained additional funds above the victims' traceable losses, which were used in money laundering and wire fraud, totaling $8.2 million.

The scammers contacted victims through various platforms, including text messages, dating applications, and professional meet-up groups. They would then gain the victim's trust and affection using manipulative tactics, before sharing personal testimonials about the success of cryptocurrency investments. This would persuade the victim to proceed with the investment, leading them to open legitimate crypto exchange accounts and transfer funds to a fake site controlled by the scammers.

In one instance, an Ohio woman was duped into sending the scammers more money, claiming she needed to make additional payments to release her initial funds. After losing her life savings, $663,000, the fraudsters allegedly threatened harm to her friends and family unless she sent more money.

As the crypto industry continues to grow, so do the various scams targeting unsuspecting investors. Blockchain analytics firm Chainalysis warns that generative AI is making scams more scalable and affordable for bad actors, which could result in record losses throughout 2025. Onchain security firm Cyvers also highlights the significance of pig butchering scams,