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State police recover $10K from cryptocurrency scam

Investigators discovered the suspect lives in India, and state police do not anticipate an arrest at this time.
Credit: ElenaR - stock.adobe.com

MIDDLETOWN, Conn. — Connecticut State Police are reminding residents and investors across the state to be aware of cryptocurrency scams after investigating a case that nearly cost a victim $10,000.

Troopers recently investigated a report of a possible scam, where a Connecticut resident deposited $10,000 into a Bitcoin ATM after being led to believe that their bank account was hacked. 

Investigators traced the flow of the funds through several Bitcoin accounts that the scammer tried to use to launder the stolen Bitcoin.

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The Bitcoin was found in an account controlled by a cryptocurrency exchange in the Cayman Islands, investigators said. The cryptocurrency exchange then helped put the stolen funds into a government-controlled account, before they went back to the victim.

Investigators discovered the suspect lives in India, and state police do not anticipate an arrest at this time.

A cryptocurrency is a virtual form of currency, and it provides some degree of anonymity. 

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More and more scams involving cryptocurrency are popping up as the form of currency grows in popularity, state police said.

Victims would be led to believe that their bank account or investments are under attack, and are then lured to a cryptocurrency ATM or a website to send their assets to a "secure" account, controlled by the scammer. They may also use "get rich quick" schemes.

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State police advise investors to be aware of the following:

  • No legitimate bank, business, or government agency will direct you to withdraw money from your bank account.
  • If a third party is sending you to a cryptocurrency ATM, it is almost certainly a scam.
  • Be aware of text messages from unknown numbers that appear to be making an attempt to gain familiarity with you or your business. These texts often begin with something low threat such as, “Hi friend” or “Didn’t we meet last week?” 
  • If you own cryptocurrency, no legitimate entity will ever ask you for your private keys or account passwords. Never share those items. 
  • If you decide to invest in new cryptocurrency coins, always check to see if they are listed on a trusted, major exchange and research the “initial coin offering” paper. Never trust coin endorsements on social media, through email, or any source promising unrealistic profits. 

Victims of a cryptocurrency scam can contact Connecticut State Police. The sooner an incident is reported, the better chance of recovering the money. Also, victims should file a complaint with the Consumer Financial Protection Bureau.

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