WASHINGTON (7News) — The digital realm has opened new avenues for investment, but with this innovation comes a darker side—cyber scams that exploit unsuspecting victims. The U.S. Justice Department has recently stepped up to confront this issue by filing a civil forfeiture complaint targeting cryptocurrency-related confidence scams. These scams primarily ensnared individuals in the District of Columbia, Texas, Illinois, and Florida, highlighting the widespread impact of this issue.
According to U.S. Attorney Jeanine Pirro, a staggering total of $868,247 in Tether (USDT), a popular stablecoin, was siphoned from at least four victims. The time frame of these fraudulent activities spanned from September 2022 to February 2023, underlining the ongoing nature of such scams. The investigative initiatives began in late 2022 after a report reached the FBI Honolulu Division Cyber Squad, revealing a victim who had lost a whopping $1.3 million to a group dubbed the LME Crypto Group.
What makes this scam particularly alarming is the method employed by the perpetrators. They impersonated the highly regarded London Metal Exchange, using its reputable name to gain the trust of vulnerable individuals. This operation illustrates how criminals can manipulate their image to create long-term online relationships with victims. These relationships are methodically constructed, often starting innocuously before luring individuals into a web of deceit involving fake cryptocurrency trading platforms.
One victim residing in the District of Columbia reported to the FBI’s Internet Crime Complaint Center in December 2023, detailing a loss of $30,000. Lured by the promise of “big profits in a short amount of time,” this individual invested in an app claiming to be affiliated with LME. This scenario reflects a widespread trend where the allure of swift financial gain often blinds people to the risks involved in cryptocurrency investments.
Scammers typically initiate contact through seemingly accidental or misdirected text messages. These communications are designed to cultivate trust over time. Victims are coaxed into making investments, often directed to phony trading platforms that cleverly mimic legitimate sites. The deceptive design of these platforms includes fake metrics and testimonials illustrating impressive returns, coaxing victims into transferring their funds willingly.
Initially, some victims may be permitted to withdraw a small portion of their “profits.” This tactic serves to solidify trust in the scam, creating a false sense of security. However, as the scammers tighten their grip, victims eventually find themselves locked out of their accounts, unable to access their funds. This emotional and financial toll can be devastating, leaving individuals grappling not only with their lost investments but also with feelings of betrayal.
The investigation into the LME Crypto Group is ongoing, spearheaded by the FBI Honolulu Field Office with support from the Justice Department’s Office of International Affairs and the FBI’s Virtual Asset Unit. The collaboration reflects a broader commitment to combatting cybercrime on a national scale. Notably, the Department of Justice acknowledged Tether for its cooperation in the freezing and transferring of the stolen assets, depicting a united front against such fraudulent activities.
For anyone who suspects they might have fallen victim to a cybercrime—whether through cryptocurrency scams, romance scams, or investment schemes—the FBI encourages reporting through the Internet Crime Complaint Center at www.ic3.gov. Early reporting can be instrumental in tracking down these criminals and safeguarding potential future victims from similar fates.