Secret Service Seizes $400 Million in Crypto Scams

The United States Secret Service has been actively involved in a decade-long crackdown on crypto scams, resulting in the seizure of nearly $400 million in cryptocurrency. This significant operation has led to the creation of one of the world’s largest crypto cold wallets, a testament to the agency’s dedication to combating digital fraud. The efforts are spearheaded by the Global Investigative Operations Center (GIOC), which employs blockchain analysis and open-source tools to trace funds and identify fraudsters.

Jamie Lam, an investigative analyst with the Secret Service, recently shared insights with law enforcement officials on how the agency identifies and traces fraudsters. Lam highlighted the deceptive tactics used by scammers, who often lure victims into fake crypto investment platforms by showing initial profits before disappearing with their deposits. These scammers frequently use attractive photos to deceive their victims, often portraying themselves as young and appealing individuals, while in reality, they could be older individuals operating from different parts of the world, such as Russia.

Kali Smith, who leads the Secret Service’s crypto strategy team, has trained officials in over 60 countries to unmask online scams and track illicit crypto flows. The agency focuses on jurisdictions with weak regulatory oversight or programs offering residency to foreign nationals, which scammers exploit to operate across borders. Smith noted that local officials are often surprised by the scale of crypto-related crime occurring within their own countries, sometimes realizing the extent of the issue after just a week-long training session.

The Secret Service’s efforts have uncovered a variety of scams, including romance-investment frauds and sextortion cases. In one notable investigation, analysts traced payments from an Idaho teenager who was extorted after sending a nude photo. This trail led to another coerced teenager acting as a money mule and ultimately to an account linked to nearly $4.1 million under a Nigerian passport. The suspect was arrested in the UK pending extradition.

Crypto-related scams have become the leading driver of internet crime losses in the United States. In 2024, Americans reported $9.3 billion in crypto fraud losses, accounting for more than half of the total $16.6 billion in internet crime losses reported that year. In the first half of 2025, crypto hacks, scams, and exploits have led to over $2.47 billion in losses, slightly up from the previous year. Recovery efforts often depend on collaboration with industry players, with some companies assisting in freezing wallets and analyzing transactions. Notably, a single operation led to the recovery of $225 million in USDT linked to romance scams, showcasing the growing effectiveness of digital asset recovery efforts amid rising fraud.