New York AG Freezes $2.2 Million In Crypto Stolen By Latest Scam

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New York Attorney General Letitia James confirmed that scam artists have stolen $2.2 million in cryptocurrencies from unsuspecting victims, many of who reside in New York. The scam was simple and targeted people looking for remote work by asking them to transfer crypto into the scammers’ digital wallets.

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The Attorney General filed a lawsuit that covers seven victims living in Queens, Nassau County, Virginia, and Florida. The scam allegedly ran for over six months between January and June of 2024.

The fraud was committed by an entire network of scammers, who cold-texted people and offered them an opportunity to work from home. Then they requested crypto to get started with the work. Due to the nature of cryptocurrencies, these transactions are more complex to trace than if they were cash transactions.

In the text message sent to victims, they were promised payment in exchange for product reviews for real brands. New recruits were required to open a crypto account and purchase stablecoins which must then be deposited into digital wallets of the scammers. The promise was that victims would get their investment as well as commission back once they started the job.

Stablecoins were purchased through reliable exchanges, including Crypto.com and Coinbase, but were then sent to unregistered crypto wallets. The scammers assured victims that the stablecoins were going to be used to cover the cost of the products that had to be reviewed. The lawsuit states, “Victims were assured that they were not buying the products, but that maintaining those account balances helped ‘legitimize’ the data they were generating.”

The victims never saw a return on their investment and there was never any work, the scammers simply disappeared with the digital currencies.

James said in a public statement, “Deceiving New Yorkers looking to take on remote work and earn money to support their families is cruel and unacceptable.” Fortunately, James was quick to act, stating, “The cryptocurrency that has been frozen thanks to my office will be available to help New Yorkers defrauded by this scam.”

One victim lost over $100,000 to the scam, believing they were being recruited for a legitimate online job offering benefits and flexible working requirements. They were directed by the scammer—posing as a recruiter and trainer—to a false website where they were required to purchase the stablecoins which were eventually stolen.

Most of the victims lost a few thousand dollars, and one lost over $300,000 in the cryptocurrency scheme.

The attorney general has warned New Yorkers to be aware of scams like these and not trust unsolicited texts or emails from unknown senders. Those who suspect they are being victimized can report the scam to the New York State Attorney General’s office.