NEW HAVEN, Conn. — Nearly $3 million in cryptocurrency was recovered in a fraud scheme, federal officials announced Friday.
Vanessa Avery, the U.S. Attorney for the District of Connecticut, and Jean Njock, acting special agent in charge of the New Haven Division of the FBI, said that the scheme targeted vulnerable victims.
The forfeiture resulted in 151 Bitcoins as well as other digital assets.
According to court documents, the scheme began in October 2020 when people overseas began targeting first-generation U.S. citizens and elderly people through phone calls, pretending to be members of U.S. law enforcement agencies.
These callers would say that the victim's identity had been compromised. The callers used computer programs to make it appear as if their calls were coming from legitimate government sources, court documents said.
Once the callers gained a victim's trust, the caller would ask for a transfer of money for "safekeeping" with the promise that the victim would receive their money, plus interest, when the perpetrators of the "identity fraud" were captured.
When the callers had access to the victim's money, they would move the money through multiple bank accounts and reportedly convert the money to digital currency in the form of Bitcoin and other cryptocurrencies.
Officials said that investigators traced the victims' money through said various accounts and found a digital wallet holding bitcoin and other cryptocurrencies that had been purchased with the money.
The U.S. Attorney's office applied for and received a civil asset forfeiture seizure warrant for the wallet.
Following the seizure, they also filed a civil asset forfeiture complaint against the digital assets, culminating in an order of forfeiture from the U.S. District Court of the District of Connecticut.
“This office and our law enforcement partners are prepared to use all tools available to investigate, disrupt, and prosecute fraud schemes, especially scams that target vulnerable populations," said Avery. “We will continue to be at the forefront of investigating and seizing digital assets such as cryptocurrency when those assets are linked to criminal behavior. Individuals committing crimes will not be able to hide the proceeds of those crimes digitally or elsewhere.”
The U.S. Attorney's office used the civil asset forfeiture procedure because the digital assets constituted the proceeds of wire fraud, officials said.
Although law enforcement continues to investigate the people overseas behind the scam, those people still remain at large. Civil asset forfeiture allowed the government recovers the victims' money while the investigation is still ongoing.
“No matter which cyber tools and methods criminal actors create to defraud members of the public, we at the FBI, U.S. Marshals and the Secret Service dedicate all resources to identifying those responsible and bringing them to justice no matter where they are in the world,” said Njock. “We encourage everyone to conduct due diligence to verify the authenticity of who they are dealing with when conducting business online to avoid being a victim of scams.”
The entire scheme is being investigated by the FBI, the U.S. Secret Service, and the U.S. Marshals Office.
People who want to confirm an actual government employee has contacted them are encouraged to call the local division of said government entity and ask to be connected directly with the officer or agent they were contacted by.
Victims of this scam are encouraged to file a report with their local law enforcement agency and the FBI’s Internet Crime Complaint Center (IC3).
Jennifer Glatz is a digital content producer at FOX61 News. She can be reached at firstname.lastname@example.org.
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