{"id":373177,"date":"2026-10-14T19:24:08","date_gmt":"2026-10-14T19:24:08","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-ny\/373177\/"},"modified":"2026-10-14T19:24:08","modified_gmt":"2026-10-14T19:24:08","slug":"brooklyn-da-shuts-down-crypto-scam-operation","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-ny\/373177\/","title":{"rendered":"Brooklyn DA Shuts Down Crypto Scam Operation"},"content":{"rendered":"

The investigation by the office\u2019s Virtual Currency Unit (VCU) and the FBI<\/a> culminated in the seizure of 241 web domains and 112 servers, which revealed the millions of dollars lost by the Russian community in Brooklyn, New York, and throughout the U.S., District Attorney Eric Gonzalez<\/a> said in a Wednesday (Oct. 14) news release<\/a>.<\/p>\n

\u201cThese criminals stole many millions of dollars from Russian-speaking victims through an elaborate investment scheme, then tried to exploit them again with false promises to recover their money,\u201d Gonzalez said. \u201cBy disrupting more than 100 servers and hundreds of fraudulent websites, we have struck at the heart of this criminal enterprise and made it far harder for these scammers to victimize others.\u201d<\/p>\n

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According to the release, the VCU has for the last three years been investigating a crypto scam targeting the Russian-speaking community in the U.S. Brooklyn is home to an extensive Russian population, meaning the scam disproportionately affected Brooklyn residents.<\/p>\n

The release said the investigation identified a large portion of victims who told the same story: they responded to a Facebook ad in Russian for investment opportunities and got a call from an \u201cinvestment advisor\u201d who helped them create an account with a crypto investment platform.<\/p>\n

When the victim eventually tried to make a withdrawal, they found themselves locked out of their account or told they had to pay extra taxes or fees.<\/p>\n

The DA estimates that tens of millions of dollars were stolen in the scheme, with some victims losing their life savings. Gonzalez\u2019s office has been able to seize about $300,000 in stolen funds so far and is working to recover more, the release added.<\/p>\n

Writing about crypto scams<\/a> last month, PYMNTS noted that the financial industry still hasn\u2019t come up with a way to stop criminals from exploiting blockchain technology.<\/p>\n

Until that happens, expanding access without enhanced guardrails mostly does more harm<\/a>, Andrew Balthazor<\/a>, associate and co-lead of the crypto asset disputes team at Holland and Knight LLP<\/a>, said during a discussion for PYMNTS\u2019 \u201cFrom the Block\u201d podcast.<\/p>\n

\u201cBut a bank evaluating a $50,000 transfer in isolation may see an authenticated customer moving their own money. A bank evaluating that transfer alongside a retirement liquidation, depleted savings, a new HELOC and multiple credit applications sees a fundamentally different risk,\u201d the report said. \u201cThat is where behavioral analytics and artificial intelligence potentially become useful, not as another mechanism for labeling crypto transactions risky, but as a way to identify combinations of otherwise ordinary financial decisions that become extraordinary when viewed together.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"The investigation by the office\u2019s Virtual Currency Unit (VCU) and the FBI culminated in the seizure of 241…\n","protected":false},"author":2,"featured_media":373178,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[36],"tags":[98,100,99,10525,3312,396,96754,9,24,12,63,31826,10693,31827],"class_list":["post-373177","post","type-post","status-publish","format-standard","has-post-thumbnail","category-brooklyn","tag-brooklyn","tag-brooklyn-headlines","tag-brooklyn-news","tag-cryptocurrency","tag-digital-assets","tag-fraud","tag-fraud-prevention","tag-new-york","tag-new-york-city","tag-news","tag-nyc","tag-pymnts-news","tag-scams","tag-whats-hot"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/373177","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/comments?post=373177"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/posts\/373177\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media\/373178"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/media?parent=373177"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/categories?post=373177"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ny\/wp-json\/wp\/v2\/tags?post=373177"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}