cryptofraud

In just one week, cryptocurrency users lost more than $1.6 million to a sophisticated tactic known as “address poisoning” — exceeding the total losses recorded in the entire month of March.
One of the largest incidents occurred on Friday, when a victim lost 140 ETH (approximately $636,500) after accidentally sending crypto to a fake address that appeared in their transaction history following an attack. “It was only a matter of time before the trap worked,” said ScamSniffer, the fraud prevention platform that uncovered the scam.
Other cases quickly followed:

🔹 On Sunday, one victim lost $880,000 in crypto

🔹 Another lost $80,000

🔹 A further victim lost $62,000

How Address Poisoning Works
Scammers send small amounts from wallets whose addresses closely resemble legitimate ones. These fake addresses then appear in the victim’s transaction history. If the user copies and pastes the address without verifying it, their funds go straight to the attacker.
According to Web3 Antivirus, this is a “transaction history poisoning” method, where attackers manipulate wallet records to make the wrong address seem trustworthy.

Phishing Signatures – Another Trap
Beyond address poisoning, ScamSniffer also recorded over $600,000 in losses this week due to malicious transaction signatures. Victims unknowingly approved commands like “approve,” “increase allowance,” or “permit,” granting scammers access to their tokens.
For example, on Tuesday, one victim lost BLOCK and DOLO tokens worth $165,000 after signing such a transaction.

How to Protect Yourself
Experts advise:

🔹 Use an address book or whitelist of verified addresses

🔹 Always check the entire address, not just the first and last characters

🔹 Avoid copying addresses directly from your transaction history

#Cryptoscam , #blockchain , #CryptoSecurity , #PhishingAlert , #CryptoFraud

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,,The information and views presented in this article are intended solely for educational purposes and should not be taken as investment advice in any situation. The content of these pages should not be regarded as financial, investment, or any other form of advice. We caution that investing in cryptocurrencies can be risky and may lead to financial losses.“

The FBI warns of a growing scam where criminals impersonate law firms or government agencies offering to “recover your stolen crypto.”
🔴 How They Trick You:
Fake legal documents & official-looking websites
Demanding upfront payment in crypto or gift cards
Claiming to be from the FBI, IC3, or government agencies
Using details from your past scam loss to gain trust
💡 Stay Safe:
✔ Verify identities through official channels
✔ Never send money to unsolicited contacts
✔ Report suspicious offers at ic3.gov
⚠ Remember: Legitimate agencies will NEVER ask for payment to recover funds.
#Bitcoin #Ethereum #CryptoSafety #ScamAlert #CryptoCommunity #BinanceNews #CryptoAwareness

Two Estonian entrepreneurs, Sergei Potapenko and Ivan Turogin, founders of the notorious company HashFlare, have breathed a sigh of relief after a lengthy U.S. court case – the judge credited them for time already served in custody, meaning they will not spend any more years behind bars.
Federal Judge Robert Lasnik in Seattle sentenced them to 16 months in prison, which they have already served since their indictment in 2022. However, they are not walking away scot-free – they must pay a $25,000 fine, complete 360 hours of community service, and face the forfeiture of assets worth more than $450 million, including real estate, cars, cryptocurrencies, and mining equipment. These assets were seized by the U.S. government together with international partners. Both will now return to Estonia under supervision.
Details on the distribution of seized assets to victims have not yet been disclosed.

Prosecution: The largest crypto fraud investigated in the U.S.
The U.S. Department of Justice has labeled the HashFlare case as the largest crypto fraud ever investigated by their offices. Prosecutors say the company defrauded over 440,000 customers between 2015 and 2019, falsely claiming to mine large volumes of cryptocurrency – when the reality was drastically different.
Investigators found that HashFlare mined less than 1% of the amount it claimed, yet collected over $550 million from clients. In 2017, under the guise of launching the Polybus digital bank, it also secured $25 million from investors.

Luxury at the expense of victims
According to Acting U.S. Attorney Teal Miller, most victims suffered not only financial losses but also emotional harm. Potapenko and Turogin used client funds to purchase cryptocurrency for themselves, luxury cars, jewelry, real estate, and even private jet rentals.
“This was a classic Ponzi scheme – millions of dollars diverted into their pockets while the victims lost their money,” Miller stated.

Defense: Customers lost little
Judge Lasnik ultimately partially accepted the defense’s argument that losses were not as severe. According to HashFlare data, about 390,000 customers who purchased mining contracts worth nearly $487 million withdrew approximately $2.3 billion.
Attorney Andery Spektor even claimed that no one suffered actual financial harm, though he admitted the company may have misled customers about mining volumes.

Appeal still on the table
Despite the ruling, prosecutors are considering an appeal, arguing that the victims’ losses were real and significant. They also claim that the defendants fabricated data and that the expert report presented by the defense focused on the company’s profits rather than the actual losses to clients.
The seized assets are intended for victim compensation, but it remains unclear when and in what amounts the funds will be distributed.

#CryptoFraud , #Cryptoscam , #CryptoNews , #blockchain , #CryptoCommunity

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Notice:
,,The information and views presented in this article are intended solely for educational purposes and should not be taken as investment advice in any situation. The content of these pages should not be regarded as financial, investment, or any other form of advice. We caution that investing in cryptocurrencies can be risky and may lead to financial losses.“

Customers of the bankrupt cryptocurrency exchange FTX are moving to strengthen their class-action lawsuit against the law firm Fenwick & West, which the exchange had previously retained. They claim that newly uncovered evidence from investigations and court proceedings shows the firm played a central role in how the fraud within FTX was carried out.
According to a court filing earlier this week, “the FTX fraud was only possible because of Fenwick’s significant assistance,” which allegedly included designing and approving corporate structures that facilitated the misuse of customer funds. FTX clients allege that the firm agreed to establish and represent highly conflicted entities such as sister company Alameda Research and subsidiary North Dimension, which “lacked any safeguards to prevent the loss of billions of dollars.”

Court Proceedings Reveal New Details
The amended complaint states that criminal proceedings against former FTX CEO Sam Bankman-Fried revealed new information about Fenwick’s involvement. FTX co-founder Gary Wang, former Alameda CEO Caroline Ellison, and ex-CTO Nishad Singh testified that Fenwick had been informed of the misuse of funds and gave advice on how to conceal such practices. Singh specifically claims the firm helped disguise unauthorized loans and falsified financial statements.

Independent Examiner: Fenwick Was Deeply Embedded in FTX’s Operations
A report from an independent examiner appointed by the bankruptcy court stated that Fenwick was “deeply connected” to FTX’s leadership and involved in most key decisions that enabled unlawful conduct. The examiner claimed the firm helped create shell companies to mask asset transfers and was behind the introduction of automatic deletion of messages in the Signal app used by FTX executives.

New Legal Claims
The amended lawsuit adds two new counts — alleged violations of securities laws in Florida and California. Fenwick is accused of actively participating in the design, promotion, and sale of unregistered securities, specifically the FTX Token (FTT) and yield-bearing accounts offered by FTX.
Fenwick has consistently denied any wrongdoing, maintaining that its actions were within the scope of legal representation. A similar lawsuit was previously filed against another law firm, Sullivan & Cromwell, but later withdrawn due to insufficient evidence.

#FTX , #CryptoFraud , #CryptoScandal , #CryptoCrime , #DigitalAssets

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Notice:
,,The information and views presented in this article are intended solely for educational purposes and should not be taken as investment advice in any situation. The content of these pages should not be regarded as financial, investment, or any other form of advice. We caution that investing in cryptocurrencies can be risky and may lead to financial losses.“

The courtroom drama surrounding Do Kwon, the founder of the failed Terra crypto project, is entering a new phase. According to the latest court filings, this controversial entrepreneur is expected to plead guilty on Tuesday in one of the largest scandals in cryptocurrency history.
On Monday, a motion for a possible change of plea was filed in the case United States vs. Kwon. This development suggests that Kwon – who had previously pleaded not guilty to charges in the U.S. – may now reverse his stance.

From a Billion-Dollar Empire to Total Collapse
Kwon was the driving force behind the Terra crypto ecosystem, whose flagship products were the LUNA token and the algorithmic stablecoin TerraUSD (UST). The project quickly gained popularity with promises of high yields and became the entry point for many investors into the world of decentralized finance (DeFi).
In spring 2022, LUNA ranked among the world’s most valuable cryptocurrencies, with Terra’s total market capitalization surpassing $40 billion. However, the algorithmic stablecoin UST failed to maintain its peg to the U.S. dollar. Once it lost stability, the entire ecosystem collapsed – wiping out billions in value and devastating hundreds of thousands of investors.

Fraud and Money Laundering Allegations
According to U.S. and South Korean prosecutors, Kwon deceived investors by promoting the project while knowing its sustainability was questionable. In the United States, he now faces nine criminal charges, including securities fraud, wire fraud, commodities fraud, and conspiracy to commit money laundering.

The Domino Effect: Crypto Contagion
The collapse of the Terra ecosystem triggered a brutal bear market that dragged down numerous companies in the crypto industry. Firms such as BlockFi and Genesis, which were exposed to Terra-linked projects, filed for bankruptcy. The situation was further exacerbated by the subsequent collapse of the FTX crypto exchange in 2022 – an event that experts dubbed “crypto contagion.”
At its lowest point, Bitcoin fell below $16,000, representing a nearly 80% drop from its 2021 peak. However, most major cryptocurrencies have since recovered, with Bitcoin recently reaching a new all-time high above $122,800.

What’s Next?
If Kwon does plead guilty in court, it would mark a dramatic turning point in a case watched closely by the entire crypto world. A plea deal could speed up the resolution of this long-running legal battle – but the penalties awaiting him are likely to be severe.

#DoKwon , #LUNA , #CryptoFraud , #CryptoCrime , #CryptoScandal

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Notice:
,,The information and views presented in this article are intended solely for educational purposes and should not be taken as investment advice in any situation. The content of these pages should not be regarded as financial, investment, or any other form of advice. We caution that investing in cryptocurrencies can be risky and may lead to financial losses.“

Wisconsin is on track to impose significant regulations on cryptocurrency kiosks located at gas stations and convenience stores across the state. The push comes in response to a sharp increase in scams, which, according to official data, cost victims nearly $247 million last year.

Two Nearly Identical Bills – Same Goal
In just two weeks, lawmakers have introduced a second piece of legislation aimed at tightening rules for kiosk operators. The latest, Senate Bill 386, was introduced by Senator Kelda Roys along with six colleagues. It mirrors House Bill 384, submitted last month by Representative Ryan Spaude and ten co-sponsors.
Both bills share the same regulatory framework and have been assigned to the Committee on Financial Institutions.

Alarming Statistics
According to the U.S. Financial Crimes Enforcement Network, complaints about crypto kiosk-related scams surged 99% in 2024. Victims’ financial losses rose 31% to a reported $247 million.
Wisconsin currently has 582 Bitcoin ATMs out of a total of 31,439 across the United States, according to Coin ATM Radar.

Strict Limits and Mandatory Warnings
The proposed measures would require operators to obtain a money transmitter license, implement strict identity verification (name, date of birth, address, phone number, and a government-issued photo ID), and cap daily exchanges at $1,000 per customer. Operator fees would be limited to $5 or 3% of the transaction amount.
Each machine would also be required to display a prominent notice:
FRAUD WARNING! Criminals attempt to scam virtual currency customers by impersonating relatives, government officials, police officers, or charitable organizations.

Experts: Less Anonymity, More Trust
According to Arjun Vijay of crypto exchange Giottus, weak KYC protocols have made these kiosks prime targets for money laundering. While tighter verification reduces anonymity, it “builds public trust and enables safer, more reliable adoption of digital currency,” adds Dileep Kumar HV of Digital South Trust.
The bills also include mandatory refunds for scam victims who report incidents to authorities within 30 days.

A Global Trend Toward Stricter Rules
Wisconsin is not the first to take action – Australia has already imposed transaction limits, and New Zealand is considering a complete ban. In the U.S., the city of Spokane, Washington, voted to remove crypto kiosks entirely after a federal investigation into multi-billion-dollar fraud losses.
If passed, the new customer verification requirements would take effect 60 days after the legislation is signed into law.

#CryptoFraud , #crypto , #Regulation , #Cryptoscam , #CryptoNews

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Notice:
,,The information and views presented in this article are intended solely for educational purposes and should not be taken as investment advice in any situation. The content of these pages should not be regarded as financial, investment, or any other form of advice. We caution that investing in cryptocurrencies can be risky and may lead to financial losses.“

Indian authorities are sounding the alarm – more and more young people are becoming unwitting “mules” in large-scale international financial fraud schemes. Criminal networks use their bank accounts to transfer huge sums of illicit money, often without the account holders realizing it.

The Waiter Lured by Easy Money
One recent case involves 24-year-old waiter Ajay from Lucknow. He told police that a friend introduced him to a “cryptocurrency trader” who offered him 20,000 rupees (around $240) to use his bank account for a single day. Eager to supplement his modest income, Ajay accepted.
The next morning, hundreds of millions of rupees were deposited into his account. He received detailed instructions on how much to withdraw and where to meet people who would collect the cash. Ajay had no idea he had just stepped into a sophisticated international fraud scheme.

From Collaborating with Criminals to Helping Police
Weeks later, Indian police knocked on his door. Investigators informed him that his account had been used to launder proceeds from cybercrime. Ajay began cooperating, providing leads that helped track down other account holders and intermediaries linked to a criminal syndicate with ties to Cambodia, Laos, Vietnam, and Thailand.

How the “Mule” Account System Works
According to India’s cybercrime units, this is a well-organized network that, over the past three months, has exploited dozens of fake or rented accounts. These accounts often belong to young people from poorer neighborhoods, students, or employees of small businesses.
They receive commissions of 10,000–30,000 rupees for “loaning” their accounts. The money is then routed through peer-to-peer networks and converted into digital assets, most commonly the stablecoin USDT.

Telegram as the Operations Hub
Police found that coordination happens via encrypted Telegram channels operated by Chinese handlers. Local recruiters source the accounts while deliberately bypassing standard identity verification (KYC).
On transaction days, mule account holders are taken to the bank to withdraw cash, which is then handed over to “brokers” who convert it into cryptocurrency and transfer it overseas.

Alarming Figures and Police Action
In just one month, Lucknow police traced 5 million rupees (around $570,000) laundered through these accounts. Around 60 young men have been arrested for having their accounts used in frauds worth millions of rupees.
“These young people are not hardened criminals, but their accounts enable the functioning of large-scale fraud operations,” said Rallapalli Vasanth Kumar, Deputy Commissioner of Police for South Lucknow, to PTI. He added that many expressed remorse and admitted they underestimated the legal risks.

#cybercrime , #CryptoFraud , #MoneyLaundering , #CryptoCrime , #CryptoSecurity

Stay one step ahead – follow our profile and stay informed about everything important in the world of cryptocurrencies!
Notice:
,,The information and views presented in this article are intended solely for educational purposes and should not be taken as investment advice in any situation. The content of these pages should not be regarded as financial, investment, or any other form of advice. We caution that investing in cryptocurrencies can be risky and may lead to financial losses.“

Authorities in India are raising alarms over a growing trend — young people unknowingly becoming “money mules” in massive cross-border fraud and money laundering operations. Criminal syndicates are exploiting their bank accounts to move huge sums of illicit funds, often without the account owners realizing the full scale of the crime.

The Waiter Who Took the Bait
Ajay, a 24-year-old waiter from Lucknow, was offered ₹20,000 (around $240) by a friend’s contact — supposedly a cryptocurrency trader — to let them use his bank account for just one day. Thinking it was quick and harmless money, he agreed. The next morning, hundreds of millions of rupees flooded into his account, followed by detailed withdrawal instructions and meeting points to hand over the cash. Unbeknownst to Ajay, he had walked straight into a sophisticated international laundering scheme.
From Unwitting Accomplice to Police Witness
Weeks later, police came knocking. Investigators told Ajay his account had been used to launder cybercrime proceeds. Realizing the gravity of the situation, he cooperated with authorities, helping trace other “mule” accounts and intermediaries linked to an international network operating out of Cambodia, Laos, Vietnam, and Thailand.
Inside the Mule Account Network
Indian cybercrime units say these operations rely on dozens of fake or rented bank accounts, often belonging to students, low-income workers, or small business employees. In exchange for “loaning” their accounts, individuals receive ₹10,000–₹30,000 in commissions. The illicit money is moved through peer-to-peer channels, converted into digital assets — often USDT — and sent abroad.
Telegram: The Control Room
Coordination happens in encrypted Telegram groups run by Chinese handlers. Local recruiters source bank accounts while bypassing KYC checks. On transaction days, mule account holders are escorted to banks to withdraw cash, which is handed over to “brokers” who convert it into cryptocurrency before transferring it overseas.
The Scale of the Problem
In just one month, Lucknow police tracked ₹5 million (around $570,000) laundered through such accounts. At least 60 young men have been arrested for unknowingly enabling large-scale fraud. Deputy Commissioner of Police Rallapalli Vasanth Kumar explained that most weren’t hardened criminals, but underestimated the severe legal consequences of their actions.
⚠️ Stay Alert
These cases highlight the real dangers of “easy money” offers. Lending your bank account, even for a day, can make you part of an international crime — with life-changing legal risks.

Disclaimer: The information shared is for educational purposes only and should not be taken as financial or investment advice. Cryptocurrency investments carry significant risks and may lead to financial losses.
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