The Brooklyn DA’s office seized assets and conducted public education campaigns targeting vulnerable communities to prevent future scams.
The Brooklyn DA (district attorney)’s Office, led by Eric Gonzalez, has successfully dismantled an intricate cryptocurrency fraud that defrauded millions of people throughout the United States.
Scammers engaged in a deceptive practice known as “pig butchering,” in which they befriended unsuspecting victims online and misled them into investing in cryptocurrencies via fraudulent websites and applications.
They ultimately prevented them from withdrawing their funds thereafter, which led to the complete loss of their investments.
Gonzalez expressed concern about the increasing incidence of these fraudulent schemes, which he defined as deceiving people outside the borough of Brooklyn in New York City. Annual losses from comparable schemes amount to billions.
Furthermore, he emphasized the importance of public education and awareness as defense mechanisms against these pervasive frauds, imploring skepticism towards excessively alluring cryptocurrency investment prospects.
Numerous complaints prompted the investigation, which was spearheaded by the Virtual Currency Unit of the Brooklyn DA’s office, culminating in a case involving a 51-year-old woman who in March 2023 reported losing $22,680 to a comparable fraud.
Chat groups where people discussed crypto investments enticed her to invest, resulting in substantial deposits and deceptive assurances of substantial returns.
Nevertheless, she encountered challenges while attempting to extricate her funds and ultimately suffered a complete loss of her investment.
Gonzalez stated, “Investment returns that appear too excellent to be true are almost always fictitious.” We strongly advise individuals who have not yet met in person to approach those who present enticing cryptocurrency investment opportunities with extreme skepticism.
An exhaustive examination of cryptocurrency transactions unveiled the intricacy of the scheme. The Brooklyn DA team found a network of servers and domains connected to the fraudulent enterprise.
In addition to identifying numerous victims from various states, the investigation underscored the extensive ramifications of these types of fraud.
Detectives also discovered a network that linked over eighty domains to the fraudulent scheme, with coinformat.com serving as the central website.
The Brooklyn DA’s office identified malicious mobile applications associated with the fraud via forensic analysis; these applications were capable of surreptitiously extracting sensitive user data.
Furthermore, the district attorney underscored the worldwide reach of these cryptocurrency fraud schemes, often aided by victims of human trafficking in Southeast Asia. This, he said, presents obstacles for efforts to recover assets and prosecute offenders locally.
Gonzalez’s office seized coinformat.com, twenty associated domains, and three virtual servers that hosted these fraudulent websites to combat such schemes.
Public Awareness Campaign by Brooklyn DA’s Office
The office’s extensive public awareness campaign, which targeted vulnerable communities such as the Chinese and Russian populations in Brooklyn, educated residents about the warning signs and preventative measures against cryptocurrency schemes.
Gonzalez issued a warning regarding potential indicators of cryptocurrency scams, including unsolicited text messages endorsing profitable investments, invitations to participate in investment groups on messaging platforms, and coercive methods requiring the installation of unverified investment applications.
Furthermore, he recommended that individuals conduct thorough research to authenticate companies, abstain from disclosing personal information, and exercise caution when placing investments exclusively on online recommendations.