How Authorities Can Unmask Crypto Scams on the Blockchain

The number of crypto scams has been skyrocketing. According to CBS News, there has been a 1,000% increase in crypto scams between October 2020 and June 2021. There are several reasons for this rising trend, including the pandemic and increased internet use. However, one reason cyber criminals use cryptocurrencies for their frauds is they don’t believe it can be traced on the blockchain. 

Although the blockchain in practice is usually anonymous, authorities can unmask the identities of people on the blockchain in a cybercrime investigation. The FBI,  in the case of the Colonial Pipeline investigation, secured a court order to see the bitcoin codes of the suspects. Additionally, advanced technology, collaboration with companies and following the path of financial transactions. 

Many crypto scammers are getting a nasty surprise when law enforcement tracks them down on the blockchain. In addition, those who were victims of crypto scams and had given up on getting their money back are being pleasantly surprised. If you have lost money to a forex trading scams or crypto scams, it is important to report the incident, file a complaint and use the services of a company that are experts at fund recovery. 

Trader Defense Advisory experts will help you evaluate whether an opportunity is legit or fake. If you have lost money to a crypto scam or a forex trading scam, contact TDA experts who are experienced in dealing with all types of scams and can help you seek justice. 

How the FBI Tracked Down the Twitter Hackers

Twitter users were shocked when they found out in 2020 that the accounts of Elon Musk, Bill Gates and Barack Obama were taken over by hackers who robbed people in a bitcoin scam. They were evern more surprised to learn that the mastermind behind this scam was just 17 years old.

While most people know that teenagers often have sophsticated technical knowledge, the extent of the hack and the kind of accounts that were taken over was newsworthy. 

However, what was also worthy of note but perhaps many people who followed the story did not realize was that, with the cooperation of Coinbase and Twitter, the amount of total money that was stolen was limited to just $118,000 because they caught the scam early and prevented many transactions from going through. 

Additionally, the FBI was able to track down and uncover the people behind this Twitter crypto scam relatively quickly. The were able to accomplish this through cooperation with Twitter, Coinbase, and Discord which provided the information they had about the suspects and the transactions.

 Law enforcement was able to trace the crypto scam mastermind Graham Clark to other bitcoin frauds. Also, advanced technology has made it easier and faster to help investigators identify who is behind crypto scams. 

Fund Recovery in the Colonial Pipeline Scam

It was like a scenario from a disaster film, but unfortunately, the situation was all too real. One of the largest pipelines in the US, the Colonial Pipeline, was sabotaged with ransomware. The company in charge was told by the cybercriminals that they must give them $4.4 million in bitcoin before they would release their control of the pipeline. 

As many areas of the country were facing the potential of fuel shortages as the result of this ransomware attack, the Colonial company paid the ransom. This was a controversial decision because many people were skeptical about the ability to track down the scammers. However, the FBI in just a few weeks after the event has managed to recover $2.7 million of the $4.4 million and the fund recovery is still in progress. 

So why do so many people think that fund recovery is not possible in crypto scams and what steps are law enforcement taking to track down scammers?

How Law Enforcement and Fund Recovery Services Track Down Crypto Scams?

The blockchain provides some visibility because it records all transactions. However, these transactions are connected to codes rather than names, so technically they are anonymous. However, when investigating crypto sams, authorities and fund recovery services have strategies for tracking down lost funds and cybercriminals. 

  • Advanced technology
  • Cooperation with tech platforms and companies
  • Court orders for access to bitcoin codes
  • Assistance from fund recovery companies

Law enforcement has at its disposal technology, cybercrime experts, and cooperation from platforms and companies that can help them locate transactions on the blockchain and uncover identities. The expression “follow the money” often works well in these investigations. Not only does law enforcement have their own technology, but they leverage private tech experts to assist them. 

The teenage Twitter hacker was found through information from Discord, Coinbase, and Twitter working together with the FBI to provide evidence. This cooperation can help law enforcement track down crypto scammers quickly. 

Even information these companies are not free to give out, such as actual bitcoin codes, can be secured by law enforcement through a court order. This information is carefully protected in regular situations, but in the context of a criminal investigation, it can be uncovered. 

In addition, fund recovery companies like Trader Defense Advisory contribute their research and investigative techniques to help law enforcement track down cybercriminals. We consult with clients, collect a detailed account from the victim of a crypto scam and create intelligence reports that can aid investigators in uncovering the cyrpto scam and the people behind it. 

This is one reason it is important for everyone who has been targeted by a crypto scam to report the incident and provide evidence. Often these fraudsters will have several rackets going and the more information authorities have, the easier it will be to catch cyber criminals and to achieve fund recovery. 

Have You Lost Money in a Crypto Scam? Talk to TDA Experts Today

If you have been the target of a scam, contact Trader Defense Advisory. Our team of experts has vast combined experience dealing with forex trading scams, crypto scams and other frauds. Consult with us and we will create a claim and help you get started on the path to retrieving your funds.