Case Study: The Most Multi-Layered Scam We’ve Seen

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We sometimes deal with clients whose situations are particularly  unusual and the situation that Lucy* faced was one such case.

She was being bombarded with emails and phone calls on a weekly basis about a sum of crypto that was apparently held in her name.

She’d invested in crypto several years ago but had lost the details due to a house move and was uncertain about whether the people contacting her were genuine or not, so she decided to reach out to The Crypto Adviser for help.

She forwarded over a wealth of information that she’d received on email about the alleged holding for us to analyse and work out if she was sitting on a goldmine or being targeted by scammers.

We soon realised that this was one of the most multi-faceted scams we’d ever encountered.

Scammers Posed as FCA

Multiple genuine organisations were being falsely represented by the scammers who’d also set up a series of fake platforms designed to look like genuine crypto and financial companies.

At various points the scammers claimed to represent the UK’s Financial Conduct Authority (FCA), a firm involved in EU’s Markets in Crypto Assets regulation, a genuine crypto recovery firm, a high street bank and a firm of independent financial adviser.

Additionally, two legitimate portfolio trackers were used as part of the scam, along with multiple email addresses and phone numbers which appeared to be genuine UK mobile numbers.

As we sifted through the documents it became clear that the people contacting her now had somehow gotten hold of her client information from the platform she’d originally made the crypto investment in.

They were now carrying out a concerted attempt at convincing her she needed to pay a large fee in order to be reunited with her funds.

What was unusual about this case was the sheer number of different fake entities involved. We’ve previously seen cases where perhaps two or three separate ‘organisations’ were being used, but nothing quite on this scale.

Hard to Recognise Red Flags

It demonstrates just how far scammers are prepared to go to try to convince victims that they are genuine and how it’s becoming increasingly difficult for people to recognise the warning signs, especially with the increasing use of AI by the fraudsters.

Fortunately we were able to explain the situation to Lucy before she sent the funds the scammers were requesting so she avoided losing what would have been a considerable sum of money.

During our analysis of the documents she sent it also came to light that she did in fact have a genuine crypto holding on a wallet she’d forgotten about in the midst of the avalanche of information she was receiving from the scammers.

This turned out to be worth several thousands pounds. Lucy decided she wanted to sell some of it and keep the rest so we guided her through the process of realising her gains and ensuring the remainder was stored securely along with the seed phrase.

Lucy decided to cut the scammers off and ignored any further communication from them. They went quiet after a couple of weeks but it remains to be seen if they’re gone for good. Only time will tell as they can be incredibly persistent.

Always Carry Out Due Diligence

Lucy’s case serves as a timely reminder to be incredibly cautious about any unsolicited communication you receive, especially when it comes to crypto or other investments, even if the sender appears to represent a legitimate entity.

Crypto and other financial scams are big business and the people behind them can sound incredibly professional and knowledgeable about the subject.

They often use this specialist information to confuse victims while twisting it slightly to make it seem as if money needs to be handed over to them when in actual fact it doesn’t.

We Can Help

If you receive a message, whether it be an email, call, WhatsApp or similar, that you’re not sure of and you want to check things out before you proceed we can help.

We can carry out a deep dive investigation into what you’re being told and who has sent it to establish if it’s legitimate or not. This can also include carrying out due diligence on investing platforms and other websites that are being used as part of the communication with you.

In addition to scams, we can also advise on many other general crypto-related queries so contact us today.

*Not her real name