On June 18, 2025, the New York State Attorney General announced that her office stopped an allegedly fraudulent cryptocurrency investment scam that targeted hundreds of Russian-speaking New Yorkers in Brooklyn and across the country.
According to the NY OAG, a joint investigation by the Office of the Attorney General, the Brooklyn District Attorney’s Office, and the New York State Department of Financial Services found that Vietnam-based scammers defrauded victims by luring them with deceptive social media ads in Russian that claimed big returns on cryptocurrency and other investments.
The alleged scammers purportedly convinced more than a hundred victims to purchase cryptocurrency and invest it into fake trading platforms, then allegedly stole the victims’ assets and disappeared.
According to the NY OAG, after learning of the investigation Meta shut down more than 700 accounts associated with an advertiser promoting the purported scam. The OAG secured a court order freezing $300,000 worth of cryptocurrency linked to the alleged scammers, and the Brooklyn District Attorney’s Office seized an additional $140,000 worth of cryptocurrency.
“Hundreds of New York investors thought they were putting their hard-earned money in safe, high-return investments, only to be defrauded out of millions of dollars,” said Attorney General James. “These scammers targeted Russian speakers on Facebook with enticing ads and my office, together with DFS and the Brooklyn District Attorney’s office, took action to stop these scammers and protect New Yorkers. I urge all New Yorkers to be vigilant of online cryptocurrency investment ads.”
“As crypto scams continue to proliferate, it is crucial for law enforcement agencies to work together in order to stop them,” said Brooklyn District Attorney Eric Gonzalez. “That’s what happened in this case, with the fraudulent network being shut down, victims warned to stop investing, and some of the stolen money getting recovered. I am grateful for the partnership with the Attorney General’s Office and the Department of Financial Services that led to this successful outcome. My office will continue to investigate every reported scam in Brooklyn and to educate residents about how to protect themselves from these dangerous frauds.”
“Through partnership and collaboration with the Brooklyn District Attorney and New York Attorney General, hundreds of thousands of dollars were returned to victims and these criminals were held accountable for their deplorable actions,” said New York State Department of Financial Services Superintendent Adrienne Harris. “As a preeminent global regulator of cryptocurrency, banks, insurers, and other financial services providers, the Department will continue to work every day to build a more equitable, transparent, and resilient financial system for all New Yorkers.”
According to the announcement, the investigation started in October 2024 when DFS became aware that an alleged fake cryptocurrency investment website was displaying what looked like a BitLicense certificate, purportedly issued by the agency. These certificates are issued to legitimate virtual currency businesses operating in New York to ensure compliance with state laws, consumer protection, and transparency, the NY OAG states. The first site NYDFS identified was WhalesTrade.com and further investigation revealed that the domain name was linked to a large network of related domains and accounts that were part of a purported scam campaign targeting Russian-speaking residents of Brooklyn and across the state and country, according to the NY OAG.
The alleged scammers involved in this matter purportedly lured victims with deceptive social media ads, many in Russian, featuring popular names and personalities. Once victims showed interest in investing, the alleged scammers responded to them and moved the conversation to encrypted private messaging apps like Telegram, according to the New York Attorney General’s office.
After the victims made an initial investment on the alleged fraudulent platforms, the purported scammers then falsely showed the victims that their investment accounts were increasing in value and encouraged victims to send more money, the NY OAG states. After making more investments, sometimes totaling hundreds of thousands of dollars, victims were unable to withdraw their funds and told they needed to pay more in false withdrawal fees or “taxes” - eventually, the alleged scammers cut off contact with the victim and pocketed their money, according the NY OAG announcement.
The NY OAG alleges that the scammers targeted Russian speakers by launching a campaign of advertisements on Facebook that promised high returns on cryptocurrency investments. To avoid revealing their real identity to Facebook and to evade restrictions on misleading and fraudulent advertisement, the alleged scammers paid an individual based in Vietnam for “Black Hat” advertising services, the NY OAG announcement states. The investigation purportedly revealed that the alleged scammers used over a million dollars’ worth of cryptocurrency stolen from victims to pay the “Black Hat” advertiser for the placement of the deceptive advertisements.
According the NY OAG, during the course of the investigation, more than 300 victims were identified and many were personally contacted by the Brooklyn District Attorney and DFS investigators and alerted to the purported fraud so that they would stop sending funds to the investment platforms.
It is estimated that the alleged scheme caused over $1 million in losses in Brooklyn alone. To disrupt the purported scheme and prevent future harm, the Brooklyn District Attorney’s Office executed a series of warrants that resulted in the seizure of over 100 domains and 17 registrar accounts; terminated alleged scammers’ access to their email, effectively disconnecting their communications with victims; seized $140,000 that was purportedly stolen from victims that can now be returned; and with DFS monitored blockchain activity in real time and warned people that had just started engaging with the alleged scammers so as to prevent future loss of funds. The OAG secured a court order freezing $300,000 worth of cryptocurrency linked to the purported scammers.
Contact an attorney general defense lawyer if you or your company have received a subpoena or are the subject of an enforcement action initiated by the New York Attorney General or another state attorney general.
