Federal prosecutors in Cleveland are seeking forfeiture of nearly $1 million in cryptocurrency linked to a scam that drained an elderly Elyria man’s life savings, highlighting the growing trend of sophisticated crypto fraud targeting vulnerable investors.
What Happened: The victim lost $408,000 after scammers, posing as Apple Inc. support representatives, gained remote access to his computer in October 2023. The criminals transferred his funds through Tether (CRYPTO: USDT), the largest stablecoin platform, to obscure the money trail, according to news publication Cleveland.
The case marks the second time in two months that Cleveland prosecutors have pursued the seizure of stolen funds laundered through Tether.
“The scammers wired money from the victim’s bank to a virtual currency account, then transferred it through multiple cryptocurrency wallets,” prosecutors told U.S. District Judge Pamela Barker in their filing. The victim and his wife now rely solely on Social Security and family support.
The Cleveland FBI’s investigation revealed an additional $539,000 in suspected stolen or laundered cryptocurrency linked to the same criminal network, bringing the total seized funds to $947,000.
Why It Matters: This case emerges amid an unprecedented surge in cryptocurrency crime in 2024, with industry losses exceeding $1.58 billion, according to recent reports. Just this August, the SEC uncovered a $650 million crypto fraud scheme, while a separate Genesis creditor heist resulted in $243 million in losses.
The scam followed a common pattern where criminals initiate contact through computer alerts, phone calls, or social media. In this instance, the perpetrators exploited the victim’s trust through a fake computer security alert and sophisticated social engineering tactics.
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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
