Millions waiting to be claimed by rightful owners as GMP rumble international crypto-currency scam
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Millions of pounds invested in a fake savings and trading service lies waiting to be claimed by rightful owners across the world, after scammers passed through Manchester and were detected by Greater Manchester Police.
A sum of $22.25 million (equivalent to just over £16 million) was seized by specialist officers from Greater Manchester Police's Economic Crime Unit, after intelligence led to the discovery of USB sticks containing huge amounts of Ethereum, the second largest Crypto currency after BitCoin.
Victims based in the UK, United States, Europe, China, Australia and Hong Kong had deposited money, including life savings, into what they thought was an online savings and trading service using Binance Smart Chain, which stores and records transactions made in crypto-currency confirming their movement and value.
The scammers operating the service waited until a significant amount of money had been deposited, before shutting down their website and transferring the funds into their own accounts. Unfortunately for them, the scammers did not disappear without trace.
Specialist officers received intelligence that those running the scheme had been in Manchester for a limited time and tracked them down, recovering an encrypted USB stick containing $9.5 million of stolen Ethereum.
A 23-year-old male and a 25-year-old female were arrested for fraud and money laundering offences. They have since been released under investigation.
They found a further $12.7million a few days later after locating a Cryptograph safety deposit box, effectively an online safe, and the code to access it.
The sum totalled 90% of the cryptocurrency stolen, and work has now begun on re-uniting it with the rightful owners, some of whom are still unknown and located across the world.
Crypto-currency saving and trading services are becoming increasingly popular, with projects offering incentives to people to invest significant amounts of money, offering tokens that can then be sold for a profit.
But increasingly savvy criminals are finding ways to exploit the trend, in ways even the most experienced users can't anticipate.
One UK resident, who wishes to remain anonymous, fell victim to the scam despite working in the industry and using cryptocurrency for years.
He lost hundreds of thousands worth ofcryptocurrency , but will now get 90% his fund back following the recovery. If funds remain unclaimed, he will receive the full 100%.
He said: "Crypto-assets often aren't understood across the world, and therefore are not taken seriously because the technology is so new, and it can be complicated.
"I'm an experienced blockchain professional, I'd done all the research with friends who work in programming development to make sure it was safe. The hack really surprised us at first.
"GMP acting so quickly reassured me that the UK is moving into the future and changing with the times, where many countries aren't. I had a significant amount of money in the project, I lost a lot. It's such a relief to get most of it back."
Greater Manchester Police has recently increased funding for its Economic and Cyber Crime units to tackle growing cases in digital and online fraud.
Both departments have received the go-ahead to boost staffing levels, with the Asset Detention and Recovery Unit receiving over £1.5 million pounds of funding for extra staff, including a Detective Inspector, a Detective Sergeant, Investigation Support Officers and Financial Investigators.
Detective Chief Inspector Joe Harrop of Greater Manchester Police's Economic Crime Unit said: "Our lives are increasingly moving online or onto our phones, and currencies like Bitcoin and Ethereum are often seen as the future when it comes to money and trading.
"With that comes a new type of crime and we're seeing a rise in opportunist criminals looking to exploit these trends as well as any gaps in the technology that can be manipulated.
"It's vital that we as a force adapt to what is an emerging type of crime, and demonstrate that there will be repercussions, regardless of the platform this fraudulent activity takes place on.
"Organised crime is getting increasingly sophisticated in faking websites and services. Most of us can say we've got a text message from a seemingly known brand or bank, and it being harder than ever to tell if it's the real deal.
"This latest case shows the huge sums we're dealing with, and the reach these organised outfits can now achieve - a whole world is potentially vulnerable to this kind of exploitation, as shown in this case.
"We urge anyone involved these platforms to use extreme caution, and know that there are still significant vulnerabilities and risks that could put their savings at risk."
Detective Sergeant Pete Nuttall of GMP's Cyber Crime team offers the following advice when using cryptocurrency and trading services: "Do your research into any investments before putting funds in. These savings and trading services can be incredibly technical, and need in depth knowledge to stay safe. Even then, there's no guarantee - if you don't understand it, don't risk it."
Follow @GMPFraud on Twitter to keep up to date with the latest information on digital and online scams.
If you believe you've been affected by this particular scam, please get in touch with us at [email protected] with the following details:
- The name of the savings and trading service invested in
- The name of the law enforcement you reported the crime to, and officer details
- Wallet addresses and documentation to prove ownership